Drug and Device Law

Going Our Way? Class Actions, Punitive Damages & Due Process

2009-07-17T03:36:00.000-07:00

Since the Supreme Court handed down Philip Morris USA v. Williams, 549 U.S. 346 (2007), we’ve posted twice – here and here – that we think Williams’ reaffirmation, in the specific context of punitive damages, of defendants’ rights to maintain all available legal defenses sounds the death knell for punitive damages class actions.

And not just in the blogosphere. One of us took this constitutional argument for a test drive in Dukes v. Wal-Mart (not a drug/device case), with encouraging results, as we discussed in greater detail, here. Briefly, before being exposed to our constitutional argument, the Ninth Circuit was quite content to affirm certification of a punitive damages class. Dukes v. Wal-Mart, Inc., 474 F.3d 1214, 1241 (9th Cir. 2007). We got into Dukes at the reconsideration stage, and the Ninth Circuit's new opinion strained mightily to avoid the punitive damages question entirely. Dukes v. Wal-Mart, Inc., 509 F.3d 1168, 1191 (9th Cir. 2007). A dissent called the majority out for dodging a specifically appealed issue, id. at 1197, and then the Ninth Circuit took the relatively unusual step of granting en banc review. We may win, we may lose. And either way Dukes may be headed eventually to the Supreme Court.

Anyway, we're back on this schtick because earlier this week an anonymous commentator (too bad, s/he’d have gotten a shout out) to our “taking stock” post mentioned a new law review article, J. Underwood, “Road to Nowhere or Jurisprudential U-Turn? The Intersection of Punitive Damage Class Actions & the Due Process Clause,” 66 Wash. & Lee L.R. 763 (2009) (online, here), disagreeing with our reading of Williams. Underwood is an associate professor at Baylor University School of Law in Waco, Texas.

That's cool. We’re always flattered when issues we raise in the blog make their way into the academic literature. So naturally we took a look.

So what do you know? It’s hard to feel flattered when we’re supposedly “tainted.” 66 Wash. & Lee L.R. at 792 (“arguably tainted views”). What we did to earn this sort of put down – something more appropriate to a blog than a law review – we’re not exactly sure. We don't mind people saying we're full of it, we couldn't be litigators if we did, but that should be decided on the strength of our arguments, not on which side of the "v" we reside. We don't think plaintiffs' lawyers, or even law professors' positions are less deserving of consideration because of the source, even when we think they're wrong.

So what's going on? We can't be sure, but since that part of the article distinguishes our views from those of “legal scholars,” we wonder if there's something about our blog's unapologetic airing of pro-defense positions in tort cases that riles up pro-plaintiff academics. After all, it wasn’t too long ago that another law review article claimed that it was somehow unethical for defense lawyers even to blog about pending cases.

We thought that that earlier article was hokum.

And we don’t think this one's that much better – at least that’s our “tainted” impression. Now let's defend it. We do that with some trepidation, since we only have a few hours of our spare time to deconstruct an article that Professor Underwood apparently took an entire sabbatical to write. 66 Wash. & Lee L.R. at 763 n.*.

First things first, we’ll review our our position.

We count five times that the Supreme Court has held that Due Process limits either the amount of punitive damages or the procedures for assessing them. See Williams, 549 U.S. at 343, 356-57; State Farm Mutual Automobile Insurance Co. v. Campbell, 538 U.S. 408, 422-25 (2003); BMW v. Gore, 517 U.S. 559, 574-75 (1996); TXO Produce Corp. v. Alliance Resolution Corp., 509 U.S. 443, 461-63 (1993); Pacific Mutual Life Insurance Co. v. Haslip, 499 U.S. 1, 18-19 (1991). The three most recent cases (Williams, Campbell, and Gore) all actually found Due Process violations that required vacation of punitive awards.

That's five Supreme Court decisions. At least by the definition that Judge Sotomayor was using at her confirmation hearing the other day, the proposition that Due Process imposes limitations on litigation seeking punitive damages should be considered “settled law.”

KOHL: . . .As you know, Judge, the landmark case of Griswold v. Connecticut guarantees that there is a fundamental constitutional right to privacy as it applies to contraception. Do you agree with that? In your opinion, is that settled law?

SOTOMAYOR: That is the precedent of the court, so it is settled law.

KOHL: Is there a general constitutional right to privacy. . .?

SOTOMAYOR: There is a right of privacy. The court has found it in various places in the Constitution, has recognized rights under those various provisions of the Constitution. . . .

KOHL: All right. Judge, the court’s ruling about the right to privacy in Griswold laid the foundation for Roe v. Wade. In your opinion, is Roe settled law?

SOTOMAYOR: The court’s decision in Planned Parenthood v. Casey reaffirmed the court holding of Roe. That is the precedent of the court and settled, in terms of the holding of the court.

Sotomayor Hearing Tr. (7/14/09), at 16, available here.

We're litigators, not law professors. We get to the Supreme Court on something more than a certiorari petition maybe once a decade if we're lucky. Thus, we tend to take Supreme Court precedent as given. We do so here with respect to the Court's punitive damages/Due Process jurisprudence.

That means we can essentially ignore the Part II of the Underwood article, entitled “Judicial Tort Reform of Punitive Damages.” It’s pretty much a screed attacking the settled law that Due Process limits what courts and juries can do with punitive damages. There may be other times that we’ve seen this much reliance on dissents in what passes for an explication of the law, but we can't think of any off the tops or our heads. We certainly wouldn’t do that in any brief we file – because we’re trying to win our cases.

Accepting that the Supreme Court meant what it said in Williams and Campbell, and following stare decisis, we see the Supreme Court’s punitive damages/Due Process precedent this way:

We start with Campbell. There the Supreme Court found a violation of Due Process for a single plaintiff’s punitive damages case to be a dumping ground for every supposedly nasty thing that a defendant ever did anywhere in the country. Rather, the conduct underpinning a punitive damages award “must have a nexus to the specific harm suffered by the plaintiff,” which the scattershot trial in Campbell lacked. 538 U.S. at 422.

[D]issimilar acts, independent from the acts upon which liability was premised, may not serve as the basis for punitive damages. A defendant should be punished for the conduct that harmed the plaintiff, not for being an unsavory individual or business. Due process does not permit courts, in the calculation of punitive damages, to adjudicate the merits of other parties’ hypothetical claims against a defendant under the guise of the reprehensibility analysis.

Id. at 422-23 (emphasis added). To us, that’s big, bold handwriting on the wall. The whole purpose of class actions is to aggregate the claims of a large number of plaintiffs. Thus, their inherent nature is to muddle the constitutionally-mandated “nexus” required by Campbell.

That’s only one piece of Campbell. The second prong of Campbell’s Due Process analysis (actually, more properly, Gore’s, since that’s where the test originated) is the ratio of compensatory to punitive damages. What’s a constitutionally permissible ratio isn’t fixed, but rather varies on a case-by-case basis depending on such things as if there’s “a particularly egregious act has resulted in only a small amount of economic damages,” or “the injury is hard to detect,” or “the monetary value of noneconomic harm might have been difficult to determine.” 538 U.S. at 425. This need for a case-by-case assessment of ratio is also fundamentally at odds with class action practice. Anything that “must be based upon the facts and circumstances of the defendant’s conduct and the harm to the plaintiff," as Campbell held is true of ratio analysis, id., can’t be decided on the proof-as-to-one-is-proof-as-to-all basis that is what class actions are all about. Class actions require "common" issues.

So that’s how we see Campbell. And we’re not alone. A bunch of courts also view Campbell as killing off punitive damages class actions: In re Simon II Litigation, 407 F.3d 125, 139 (2d Cir. 2005) (Campbell mandates decertification of punitive damages class); Johnson v. Ford Motor Co., 113 P.3d 82, 94-95 (Cal. 2005) (Campbell precludes something called “aggregate disgorgement,” which the court analogized to punitive damages); Engle v. Liggett Group, Inc., 945 So.2d 1246, 1265 (Fla. 2006) (Campbell requires decertification of punitive damages class and reversal of $145 billion verdict) (full disclosure – Bexis was on the defense team in Engle); EEOC v. International Profit Associates, Inc., 2007 WL 3120069, at *10 (N.D. Ill. Oct. 23, 2007) (Campbell bars mass actions, in addition to class actions, for punitive damages); Williams v. Telespectrum, Inc., 2007 WL 6787411, at *6 (E.D. Va. June 1, 2007) (Campbell precludes punitive damages class action); Colindres v. QuitFlex Manufacturing, 235 F.R.D. 347, 378 (S.D. Tex. 2006) (same); O’Neal, v. Wackenhut Services, Inc., 2006 WL 1469348, at *22 (E.D. Tenn. May 25, 2006) (same); Carlson v. C.H. Robinson Worldwide, Inc., 2005 WL 758602, at *16 (D. Minn. March 31, 2005) (individualized inquiry for punitive damages mandated by Campbell renders proposed class unmanageable).

The courts weren’t unanimous, of course – when are they ever? For one thing, there was first the district court and then the Ninth Circuit (at least initially) in Dukes.

Now we get to Williams. The Due Process holding is considerably more direct in Williams because the Court wasn’t undertaking excessiveness review à la Campbell. Rather, Williams holds rather bluntly that punitive damages cannot be based on anything other than the defendant’s conduct towards the specific plaintiff litigating the case. “We did not previously hold explicitly that a jury may not punish for the harm caused others. But we do so hold now.” Williams, 549 U.S. at 356-57. It’s pretty hard to square this holding with a class-wide determination of thousands of punitive damages claims in one fell swoop. Rather, that appears to be precisely what Williams held that Due Process prohibits. We think the Court meant what it said when it held that punitive damages cannot constitutionally be awarded on a “represent[ative]” basis:

[T]he Constitution’s Due Process Clause forbids a State to use a punitive damages award to punish a defendant for injury that it inflicts upon nonparties or those whom they directly represent, i.e., injury that it inflicts upon those who are, essentially, strangers to the litigation.

Williams, 549 U.S. at 353 (emphasis added). Last time we looked, just a few minutes ago, class actions were the epitome of a “representative” action. E.g., Amchem Products, Inc. v. Windsor, 521 U.S. 591, 623 (1997) (Rule 23 “legitimizes representative action”); General Telephone Co. v. EEOC, 446 U.S. 318, 326 (1980) (distinguishing EEOC enforcement actions from “representative actions subject to Rule 23”).

Put that together with Campbell, and you've got a pretty persuasive motion to strike punitive damages class action allegations – but there’s a second, equally important, thread in Williams. The Court went on to explain why litigating punitive damages in a representative fashion violates Due Process. In a holding that we, as defense counsel, think is self-evident, the Court specifically stated that defendants faced with “punishment” have a constitutional right to defend themselves. “[T]he Due Process Clause prohibits a State from punishing an individual without first providing that individual with ‘an opportunity to present every available defense.’” Williams, 549 U.S. at 353 (quoting Lindsey v. Normet, 405 U.S. 56, 66 (1972)) (emphasis added by us).

Just what was the Court referring to when it referenced “every available defense”? Well, in Williams the defenses that the Court considered constitutionally protected were a plaintiff’s knowledge (“knew that smoking was dangerous”) and reliance (“did not rely upon. . .defendant[]”). Id. Those are precisely the types of individualized defenses that, time and again, defeat class certification under the “predominance” rubric of Rule 23(b)(3). In Lindsey, which likewise held that “[d]ue process requires that there be an opportunity to present every available defense,” 405 U.S. at 66, the Court was dealing with a state-law forcible entry and wrongful detainer action. We don’t know squat about that, but it's some sort of landlord-tenant action. The Lindsey Court mentioned the following defenses: failure to maintain the premises, mental incompetence, forfeiture of lease, reformation of lease, breach of dependent covenant. Id. at 66 & n.11. That would seem to cover the waterfront.

There are lots of defenses to punitive damages. A lot of jurisdictions require liability – that is, there can be no punitive damages unless the defendant is first liable on the underlying action. That’s where reliance and knowledge in Williams came in, as well as defenses such as the statute of limitations, assumption of the risk, warning causation, medical causation, and product misuse, to name a few. Most jurisdictions also incorporate some sort of proportionality requirement as a matter of state substantive law (as opposed to the Gore ratio element). That brings the amount of an individual plaintiff’s compensatory damages into play.

Since Williams, not only has the Dukes court backtracked, but more courts have declared that class actions for punitive damages run afoul of Due Process. In re Conagra Peanut Butter Products Liability Litigation, 251 F.R.D. 689, 701-02 (N.D. Ga. 2008); Nelson v. Wal-Mart Stores, Inc., 245 F.R.D. 358, 376 (E.D. Ark. 2007); see also EEOC v. International Profit Associates, Inc., 2007 WL 3120069, at *10-11 (N.D. Ill. Oct. 23, 2007) (requiring, in an EEOC mass action, that punitive damages be determined individually). Another court, State ex rel. Chemtall, Inc. v. Madden, 655 S.E.2d 161, 167 (W. Va. 2007), imitated the Dukes panel’s strategy of punting the issue down the road.

Thus, we don’t think that the requirements of the Due Process Clause - specifically as applied to punitive damages in Williams - can be squared with the “predominance” of “common issues” necessary to maintain a class action under Rule 23(b)(3).

And there’s still more. Williams is a gift that keeps on giving. It’s hard to see that classwide punitive awards encompassing absent class members who never appear in court can escape being held “standardless” and “speculative” in violation of Due Process. Williams held:

To permit punishment for injuring a nonparty victim would add a near standardless dimension to the punitive damages equation. How many such victims are there? How seriously were they injured? Under what circumstances did injury occur? . . .The jury will be left to speculate. And the fundamental due process concerns to which our punitive damages cases refer – risks of arbitrariness, uncertainty, and lack of notice – will be magnified.

549 U.S. at 354 (citations omitted). Thus, juries may not punish a defendant for harm to those who never set foot in the courtroom. Id. at 355 (“a jury may not go further. . .and use a punitive damages verdict to punish a defendant directly on account of harms it is alleged to have visited on nonparties”).

With respect to absent class members, juries do not – indeed, cannot – hear the answers to the questions the Court posed in Williams. Any attempt at class-wide adjudication of punitive damages necessarily “magnifies” the “fundamental due process concerns” that led to the unconstitutionality findings in Williams, Campbell, and Gore.

Anyway, that’s our position. Now we’ll look at the holes the Underwood article tries to punch in it, and maybe we'll punch a few holes ourselves.

The article certainly likes class actions a lot, describing them as “offer[ing] an unparalleled and unique joinder device that permits a multitude of claimants’ claims to be adjudicated.” 66 Wash. & Lee L.R. at 779-80. “[T]he primary motivating principle underlying this group litigation device was one of efficiency. Id. at 781 (emphasis original). Class actions are “the HOV lane of litigation traffic.” Id.

Okay, we might debate that point (given their size and expense, class actions could equally be called the SUVs of litigation traffic), but we don’t see the point of it. That class actions might be “efficient” is, in this context, a non sequitur. We don’t dispense with constitutional rights on grounds that they are inefficient. It would probably be most "efficient" not to allow defendants to put on a defense at all – but it’s not constitutional. Williams and other Supreme Court precedent hold that defendants cannot constitutionally be deprived of any defense to which the law entitles them. We're not going to play "what if" games with controlling Supreme Court precedent.

We trudge onward.

Next, the article discusses “limited fund” class actions. 66 Wash. & Lee L.R. at 783-86. This is another tangent. Ortiz v. Fibreboard Corp., 527 U.S. 815 (1999), essentially killed off mandatory limited fund classes in mass torts. The article cites two cases, In re Simon II Litigation, 211 F.R.D. 86 (E.D.N.Y. 2002), which was reversed by one of the cases we’ve cited, and In re Exxon Valdez, 270 F.3d 1215 (9th Cir. 2001). We know what happened in Exxon Valdez – the Supreme Court shaved an already reduced punitive damages award down to $507.5 million. Exxon Shipping Co. v. Baker, 128 S. Ct. 2605, 2634 (2008) (non-constitutional basis for reduction). Somehow, we don’t think that an award of that size could justify calling the largest oil company in the world a “limited fund.”

Anyway, limited fund class actions are not the point. Our Williams argument is concerned primarily with Rule 23(b)(3) class actions like Dukes, or we're confronted with in the mass tort world where we practice.

The Underwood article finally gets to Rule 23(b)(3), beginning on page 786. But it meanders. It doesn’t get to punitive damages class actions in the Campbell/Williams era until page 791.

That’s when it calls us “tainted.”

After 35 pages of prologue, the rubber finally meets the road beginning on page 796. Professor Underwood’s first proposition is that Campbell “reaffirms that the common focus in punitive damage adjudication remains on the defendant and also shows the advantages class treatment offers for punitive damages in scenarios involving multiple potential claimants.” 66 Wash. & Lee L.R. at 796-97. There are over 200 footnotes in this article, but this key proposition doesn’t have one. That’s because Campbell doesn’t deal with “common focuses” or “multiple claimants.” It’s a one-plaintiff case.

The Court in Campbell does quote Gore’s statement that “the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant’s conduct.” 538 U.S. at 419. Maybe that’s what's being referred to. But that’s in the context of Due Process analysis – it doesn’t say anything one way or another about the merits of punitive damages claims. That's where, among other things, our right to "every defense" comes in.

The article then makes the true statement – for the Supreme Court anyway – that “the Court has never applied these due process constraints in the context of a class action.” 66 Wash. & Lee L.R. at 797. Okay, but a whole lot of lower courts since Campbell have done so, and found its Due Process analysis directly applicable to class actions. Why then, is that position “hyperbole”? Id. It’s hard to say, except that the author doesn’t like that result.

The article argues that equating unnamed class members with “strangers” to litigation is inapt because “class members are clearly bound by the result[].” Id. This claim hides the ball. We've already block quoted (with emphasis) that precise passage above. The evil the Supreme Court was addressing in Williams when it mentioned "strangers" to litigation was a defendant’s inability to present defenses specific to those strangers’ claims. 549 U.S. at 353. That same problem exists – is inherent in – class actions. Also, the article fails to mention that the Court refered to representative litigation in the same sentence. Add in what the article omits from this part of Williams and it's pretty clear that the case stands for exactly the opposite of what the article states.

Next proposition: “[O]ne must bear in mind that due process is flexible and calls for such procedural protections as the particular situation demands.” 66 Wash. & Lee L.R. at 797 (citation and quotation marks omitted). As a general proposition that's true, but Williams addressed what Due Process “demands” in the specific context of punitive damages – “an opportunity to present every available defense.” 549 U.S. at 353. So, where punitive damages are concerned the bounds of "flexibility" are delineated by Williams. As for finagling, well, the article doesn’t even try to describe a class action scenario that preserves “every available defense” against each class member's punitive damages claim. It can’t be done. That's why we've said class actions and punitive damages are unconstitutional together.

The article moves on to the purposes of punitive damages, stating (among a lot of other things) that “the Court has not retreated from the concept of states’ legitimate use of punitive damages for the purpose of providing general deterrence from abhorrent behavior.” 66 Wash. & Lee L.R. at 798.

This argument is a textbook example of raising a straw man. We don’t argue that the underlying purposes of punitive damages aren’t still punishment and deterrence. That’s not relevant because we’re not taking the position (at least not here) that punitive damages – in and of themselves – are unconstitutional. Due Process is about process. To illustrate, let’s take another form of punishment. The death penalty is constitutional, but that doesn’t justify stringing people up to the nearest tree, or burning them at the stake. Umm. . .maybe there has to be a Waco exception to that second example.

That punitive damages serve a legally valid purpose doesn’t change Williams' and Campbell's Due Process requirements, or any any Due Process requirements. Every legal proceeding, no matter how justified, must be conducted in accordance with Due Process in that particular context, and in the case of punitive damages that means Campbell and Williams. No amount of flag-waving for punitive damages can make Due Process go away.

We're not sure why, but the article next goes back to “limited fund” mandatory certification. 66 Wash. & Lee L.R. at 799-800. It offers a block quote from In re Simon II, 407 F.3d 125 (2d Cir. 2005). Sorry, that’s the wrong quote about the wrong subject. In Simon II the court specifically discussed both Campbell (Williams hadn’t been decided yet) and Due Process. There’s thus no need to infer anything. The court held:

[W]e have an additional concern that warrants some discussion. It seems that a punitive award under the circumstances articulated in the Certification Order is likely to run afoul of the Supreme Court’s admonitions in [Campbell], a decision handed down several months after the Certification Order issued. In certifying a class that seeks an assessment of punitive damages prior to an actual determination and award of compensatory damages, the district court's Certification Order would fail to ensure that a jury will be able to assess an award that, in the first instance, will bear a sufficient nexus to the actual and potential harm to the plaintiff class, and that will be reasonable and proportionate to those harms. . . .

Although the Court was considering an award in an individual, not a class, action, it noted that punishment on any basis that does not have a nexus to the specific harm suffered by the plaintiff “creates the possibility of multiple punitive damages awards for the same conduct; for in the usual case nonparties are not bound by the judgment some other plaintiff obtains.” [Campbell, 538 U.S.] at 423. In addressing the punitive award to the Campbells, the Court stated, “we have been reluctant to identify concrete constitutional limits on the ratio between harm, or potential harm, to the plaintiff and the punitive damages award. We decline again to impose a bright-line ratio which a punitive damages award cannot exceed.” Id. at 424-25 (citation omitted). Recognizing that “there are no rigid benchmarks,” the Court noted that greater ratios may be warranted “where a particularly egregious act has resulted in only a small amount of economic damages” or “where the injury is hard to detect or the monetary value of noneconomic harm might have been difficult to determine.” Id. at 425 (internal quotations omitted). “In sum,” the Court concluded, “courts must ensure that the measure of punishment is both reasonable and proportionate to the amount of harm to the plaintiff and to the general damages recovered.” Id. at 426.

Furthermore, with respect to the evidence to be considered at the punitive damages stage, [Campbell] indicates that a jury could not consider acts of as broad a scope as the district court in this case anticipated. . . . [Campbell] made clear that conduct
relevant to the reprehensibility analysis must have a nexus to the specific harm suffered by the plaintiff, and that it could not be independent of or dissimilar to the conduct that harms the plaintiff. 538 U.S. at 422-23. Harmful behavior that is not “correlatable” with class members and the harm or potential harm to them would be precluded under [Campbell].

Simon II, 407 F.2d at 138-39 (various citations and block quotes omitted).

Appellate Advocate’s Rule #1 – don’t cite cases that kill you.

The article’s next argument, once it gets back to Rule 23(b)(3) class actions, is that class certification of punitive damages is “superior” “when viewed through the prism of the multiple punishment concern.” 66 Wash. & Lee L.R. at 800. That is, class actions should be certified so that defendants aren’t saddled with “redundant punishment in multiple, distinct civil cases.” Id.

Talk about crocodile tears. Pul-eese, Professor Underwood, don’t try to do defendants any favors. This argument is either supremely cynical or astonishingly naïve (but not tainted). Earlier, when the article was criticizing the Court in Williams, it speculated, “one must wonder how much experience the Justices in the majority have had watching how jury trials are conducted.” 66 Wash. & Lee L.R. at 777.

We could say the same thing here. If the author really believes that defendants are better off facing punitive damages class actions than possible “redundant” punitive awards in separate litigation, we wonder how much practical experience he has with mass tort litigation – or any mass litigation. Every defendant we’ve ever represented has fought certification of punitive damages class actions tooth and nail. Why? Look at Engle (cited earlier), where the trial court did exactly what the article advocates. The result? A $145 billion punitive damages award that, had it not been declared an unconstitutional violation of Due Process, would have bankrupted the defendants. We know very few defendants willing to take that kind of a risk. Thus we think punitive damages class actions are a form of litigation terrorism.

After quoting a “commentator” – a law review article that no court anywhere has ever cited – the author claims that “[t]he American Law Institute similarly recognizes the significance of this redundant punishment danger." 66 Wash. & Lee L.R. at 801 (citing and quoting ALI, Reporters’ Study, Enterprise Responsibility For Personal Injury 260–61 n.5 (1991)).

That's not so. We can tell by the name of the source.

We're both members of ALI, so we've had to learn the Institute's nuances. A “Reporter’s Study” is just that – the views of the reporters, not the view of ALI itself. Only documents voted on by the ALI’s full membership – chiefly Restatements and Principles Projects – constitute the position of the Institute.

Regular readers of this blog know that just last May the ALI did take a position on class action issues, voting to approve the Principles of the Law of Aggregate Litigation. We discussed that here. At one point, a draft of the Principles advocated punitive damages class actions. We criticized that aspect of the draft, here, stating :

The draft continues to advocate deciding punitive damages on an aggregate, classwide basis. After Philip Morris USA v. Williams, 127 S. Ct. 1057 (2007), that has to come out, since Williams expressly recognized that defendants are constitutionally entitled to raise all individualized defenses prior to being hit with punitives.

Guess what? The offending discussion was removed from the Principles project. The final draft - the one ALI's membership approved - doesn’t reference punitive damages classes at all, except in the Reporters' Notes as an historical an example of a “limited fund.” And "reporters notes" are not the position of the ALI either. We'd link to that final draft, but as loyal ALI members we can't. You can buy it from the ALI.

In short, the ALI does not support punitive damages class actions.

Next argument please: That the “dictate” in Williams that a “jury may consider harm to third-parties only for purposes of reprehensibility but not for the purpose of punishing the tortfeasor defendant” somehow supports use of a class action. 66 Wash. & Lee L.R. at 801. In this way, the article asserts, Williams “creates a significant risk of future reversals of punitive damage verdicts based upon nit-picky review of jury instructions.” Id. at 802.

If one considers defendants’ constitutional rights “nit-picky,” then maybe the argument makes some sense.

“Group litigation,” according to the article, supposedly solves this problem “[b]y converting other victims of the tortfeasor’s misconduct from ‘strangers’ into class members.” We've already debunked this point - “strangers” isn't the only word the Court used; in the same position are “those whom [are] directly represent[ed]” in litigation. In either case, defendants must be given their constitutional right to assert “every defense” to which they are legally entitled. Williams, 549 U.S. 353. That includes the many individualized defenses to punitives that are incompatible with determining claims of thousands (or more) of people at the same time. See Appellate Advocate’s Rule #1, above.

Then what? The article quotes at length from a 23-year-old (that is, before any of the relevant Supreme Court precedent) ABA recommendation “that a defendant faced with multiple punitive damage claims be permitted to request class treatment in federal court.” 66 Wash. & Lee L.R. at 803. Since that source predates even Haslip by five years, the ABA's proposal obviously says nothing about Due Process and punitive damages. And it’s predicated on a defendant’s request. As we said before, don’t purport to do our side any favors. We can take care of ourselves – we’ve got Williams and Campbell now.

Then, how about this howler?

[F]or every court that has declared class treatment of punitive damages no longer constitutional, one can find another example of a court detecting no constitutional barriers to treating punitive damages as a common class issue.

66 Wash. & Lee L.R. at 803. At least there’s a footnote, so we can take a look at the supporting cites. There’s the first Dukes opinion. But not only was that opinion superseded on reargument, the reargued opinion was then withdrawn by the grant of en banc review. That's not a case we'd even think of citing in a brief. Then there’s Ellis v. Costco Wholesale Corp., 240 F.R.D. 627, 643 (N.D. Cal. 2007), which neither cites Campbell nor mentions Due Process. Ellis is thus cited for a “constitutional” proposition it didn’t even discuss. Then there are two pre-Campbell cases.

That’s it.

In this post, we’ve cited two state supreme court cases, one federal appellate decision, and eight federal district courts – all refusing to certify class actions explicitly for constitutional reasons since Campbell. At this point there is exactly one case going the other way – In re Tobacco Litigation, 624 S.E.2d 738 (W.Va. 2005). We could point out how “narrow” that court described its holding – limiting it to the reverse bifurcation question – but we won’t bother. We’ll give Professor Underwood West Virginia.

We do note that since the West Virginia Supreme Court’s 2005 decision refusing to grant extraordinary relief against a trial plan, the underlying cases apparently have yet to be tried – so the core Due Process issue of deprivation of defenses hasn’t been litigated, only the Red Queen (“Sentence first—verdict afterwards”) trial plan.

That’s essentially it. The article finishes by once again claiming that class action treatment of punitive damages does defendants a favor by sparing our clients the risk of “repeated, separate punitive damage verdicts. 66 Wash. & Lee L.R. at 806.

Once again, we expect that most defendants will continue to decline this offer of assistance.

Anyway, that’s our view of the Washington & Lee Law Review Article. We take the Supreme Court's precedent as a given, thus we’ve found nothing in the article that warrants us reconsidering the views on class actions and punitive damages that we’ve expressed in our prior blog posts – but we had some fun critiquing it.

We hope our readers have, too.

Contact Lens Solution - Frye Exclusion

2009-07-16T03:56:00.000-07:00

So sayeth the NY state court in In re Bausch & Lomb Contact Lens Solution Product Liability Litigation, slip op. (N.Y. Sup. July 15, 2009). This post is necessarily skeletal, as Herrmann is on vacation and Bexis' firm is involved in this litigation.

The litigation had a problem, on the one hand the defendant's contact lens solution (when misused) was allegedly linked an increase in a particular fungal (called Fusarium) infection. There were a bunch of studies and other investigations looking into that.

But plaintiffs' counsel's indiscriminate solicitation of clients resulted in a bunch of plaintiffs who didn't have Fusarium infections. They had various other infections that had never been linked to the defendant's product.

"Never" is not an exaggeration. In the words of the court:

Plaintiffs' experts have not cited a single case report, clinical study, epidemiological study, or published and peer reviewed article, concluding as they do, that [defendant's product] is capable of causing non-Fusarium infections.

Slip op. at 23.

So what did the plaintiffs' experts offer, in the absence of anything resembling scientific proof?
Extrapolation from Fusarium-related studies. In-vitro (in a test tube) studies, without even animal studies to support them. "[G]eneral theories that an increase in microbial load [assumed] can result in an increased risk of infection" - with no established threshold. No actual testing of the defendant's product, even though they had samples. Slip op. at 23-26.

The result - exclusion - was hardly surprising. Again, as the court stated:

[T]his exercise [plaintiffs' expert's causation opinions] is more a leap of faith than a scientifically reliable analysis. The end product is the very "junk science" that the court is required to exclude.

Slip op. at 24. There's more, but you'll need to read it yourself.

Wisconsin High Court - Inherent Chemical Characteristics Can't Be Design Defects

2009-07-15T03:52:00.000-07:00

In a decision with implications for similar claims in pharmaceutical cases, the Wisconsin Supreme Court held yesterday in a lead pigment case that an inherent chemical characteristic can't be a "design defect." The case is Godoy v. E.I. Dupont de Nemours & Co., slip op. (Wis. July 14, 2009).

The key paragraphs are numbers 31 and 37:

Lead is a characteristic ingredient of white lead carbonate pigment. By definition, white lead carbonate pigment contains lead. Removing lead from white lead carbonate pigment would transform it into a different product. Under these circumstances, we conclude that the design of white lead carbonate pigment is not defective.

The circuit court correctly concluded that the complaint failed to state claims of defective design. A claim for defective design cannot be maintained where the presence of lead is the alleged defect in design, and its very presence is a characteristic of the product itself. Without lead, there can be no white lead carbonate pigment. We therefore conclude that the complaint fails to allege a design feature that makes the design of white lead carbonate pigment defective.

Slip op. at pp. 16, 19.

Importantly, the ruling comes on a motion to dismiss - no need for expensive and time-consuming discovery.

Most drug cases - those involving the characteristics of a single molecule/chemical constituting an FDA-approved drug - are such that the Godoy rationale would apply to design defect claims. The "design" of this kind of drug cannot be changed without creating a different molecule, and thus a different product (and one requiring separate FDA approval). In that situation, under Godoy, and indeed under simple common sense, there can't be design defect claims, but only warning claims concerning the drug's inherent characteristics. That's basically what Restatement §402A, comment k is all about. Godoy is significant in that it states the proposition both clearly and generally.

Fraudulent Joinder Of Sales Representatives

2009-07-14T05:00:00.000-07:00

We don't call anyone a "loyal reader" of this blog, for fear that that would reflect poorly on them.

But Susan Burnett, of Clark, Thomas & Winters, has ocasionally made the mistake of dropping by the blog, and today she's submitted a guest post. What follows is her work alone; she gets the cheers, she gets the brickbats, and she gets our thanks for having shared this with us:

The argument that sales representative employees of pharmaceutical companies can be personally liable to untold numbers of patients they have never met — that their bank accounts can be seized and their wages garnished — based on these employees’ brief interactions with prescribing physicians is a fiction employed by plaintiffs solely to stay out of federal court. Few products liability cases against pharmaceutical companies actually go to trial with a sales representative defendant still in them. But as the recent Avandia decision (discussed in an earlier Beck and Herrmann post here) shows, the common sense understanding that the suit against the sales representative is a sham doesn’t always translate into a successful fraudulent joinder removal, even when the federal court is skeptical of the plaintiff’s claims. In re Avandia Marketing, Sales Practices, MDL No. 1871, 2009 WL 1708078, * 5 (E.D. Pa. June 18, 2009) (plaintiffs stated a colorable claim against the sales representatives even though “it is difficult to imagine a scenario in which a drug company divulges otherwise secret information about the dangers of its product in training materials or educational sessions given to sales representatives.”).

Here are some thoughts on ways to expose the sham and get to federal court.

Sometimes, the plaintiffs make it easy. Some plaintiffs simply list sales representatives in the caption and introductory paragraphs, but ignore them in the rest of the complaint. In some circuits, that can be a ticket to removal. See Griggs v. State Farm Lloyds, et al., 181 F.3d 694, 699 (5th Cir. 1999) (affirming denial of remand where plaintiffs mentioned the non-diverse employee defendants only in the caption and parties section of the state-court complaint, without ever alleging any specific, actionable facts against those defendants). Or the plaintiff may name random sales representatives who (1) never detailed the drug, (2) never detailed the plaintiff’s prescribing physician, or (3) didn’t detail the drug or plaintiff’s physician until after the plaintiff’s alleged injury. With declarations from the sales representatives to that effect, one can argue that nothing the sales representatives did or did not do could have affected the doctor’s prescribing decision for the plaintiff, and that they therefore are fraudulently joined. See, e.g., Dacosta v. Novartis AG, 180 F. Supp. 2d 1178, 1182-83 (D. Or. 2001); In re Diet Drugs Prods. Liab. Litig., No. 03-20611, 2004 WL 2203712, at *2 (E.D. Pa. Sept. 28, 2004); In re Diet Drugs Prods. Liab. Litig., No. 03-20546, 2004 WL 1535828, at *11 (E.D. Pa. July 6, 2004).

It’s a harder case when the plaintiff names sales representatives who actually detailed the right drug to the right doctor during the right time, and actually pleads a cause of action against them. When the plaintiff asserts only failure to warn or breach of warranty, some courts have agreed that sales representatives cannot be liable under these theories because they are not “sellers” under state law. In re Diet Drugs Prods. Liab. Litig., 220 F. Supp. 2d 414, 425 (E.D. Pa. 2002) (“[S]ales representatives are not considered ‘sellers’ under Mississippi law, but rather, employees of the businesses who are sellers.”); In re Diet Drugs Prods. Liab. Litig., No. 03-20546, 2004 WL 1535828, *10 (“While the product’s ‘seller’ owes the consumer a duty to warn of a product’s dangers, [the pharmaceutical manufacturer], and not the sales representatives, was the ‘seller.’ . . . . Accordingly, the sales representatives owed no independent duty to warn under Texas law.”); see also Restatement (Third) of Torts § 20, cmt. g. (“Persons assisting or providing services to product distributors, while indirectly facilitating the commercial distribution of products, are not subject to liability under the rules of this Restatement.”). That ought to be the result as a matter of law, but it wouldn’t hurt to get a declaration from the sales representative spelling out that he or she didn’t “sell” the drug. See DaCosta, 180 F. Supp. 2d at 1182-83 (“[The sales representative] stated in his Affidavit that he does not sell drugs, does not take or process orders for drugs, and has no ownership interest in the drugs sold by Defendant Novartis Pharmaceuticals.”); Del Bosque v. Merck & Co., Inc., No. C-06-510, 2006 WL 3487400, *2-*3 (S.D. Tex., Dec. 1, 2006) (court assumed that sales representatives could be sellers of drug in the absence of a declaration).

The hardest case is when the plaintiff alleges that the sales representative engaged in intentional misrepresentation or fraud. Even if the plaintiff’s pleadings are sketchy and everybody involved knows that the fraud claim is bogus, if the court (as in Avandia) applies a liberal pleading standard, the defendant is left with the burden of proving that there is no possibility that the plaintiff can recover against the sales representative.

There are two kinds of evidence that might solve this dilemma. First, the sales representative can provide a declaration refuting at least one element necessary to prove fraud. The diet drug MDL court relied on such declarations to deny remand under Florida law. In re Diet Drugs Prod. Liab. Litig., No. 03-20765, 2004 WL 1824357, *4 (Aug. 12, 2004) (“Wyeth has offered sworn testimony that the three defendant sales representatives named in this action had no knowledge of any connection between the diet drugs and valvular heart disease while they were promoting the diet drugs. There is nothing in the record before us to contradict this testimony.”); see also Legg v. Wyeth, 428 F.3d 1317, 1321-25 (11th Cir. 2005) (district court erred in awarding attorneys fees to plaintiff because defendant’s removal, based on declarations of sales representatives denying fraud, was not improvident). The following language, quoted in the Legg court’s opinion, apparently was sufficient to negate the fraud allegations: “I was not aware of any alleged association between Pondimin and/or Redux and valvular heart disease until the time such an allegation was first publicized. I was not aware before that time of any published study, report or other literature which claimed that an association exists between Pondimin and/or Redux and valvular heart disease.” Legg, 428 F.3d at 1321.

Timing is an issue here and it’s safest to obtain the declaration and remove within 30 days of service rather than try to argue that the declaration, especially one from a current employee, constitutes a removal trigger under the second paragraph of 28 U.S.C. § 1446(b) (actions not initially removable).

The second way to get around a fraud allegation is through the prescribing doctor. If the doctor testifies (by deposition, or by declaration if you are allowed to have ex parte contact in your jurisdiction) that he or she did not rely on any communications with sales representatives in deciding to prescribe the drug for the plaintiff, that testimony arguably destroys any causal link between the sales representative’s (fictional) fraud and the doctor’s prescribing decision, making the representative fraudulently joined.

Yet Another Off-Label Promotion Class Action Dismissed

2009-07-14T04:28:00.000-07:00

A tip of the old cyberhat - and not for the first time - to Alan Modlinger at Lowenstein Sandler for passing along to us the latest good news on the off-label promotion front - dismissal (with leave to replead under Twombly) in In re Schering-Plough Corp. Intron/Temodar Consumer Class Action, slip op. (D.N.J. July 10, 2009). It's a whopper - 72 pages.

Despite the name, there aren't really many "consumers" in the case - mostly a bunch of third-party payers (TPPs) with their hands out. It's the usual piggy back ("filed on the heels of" slip op. at 21), on an FDA prosecution for off-label promotion. The damages allegations, as well, are what we've come to expect: a fraud on the market type theory that somehow the off-label promotion increased the overall price of the drug - even though the drug's price for on- and off-label uses was the same. There's also the standard TPP claim that they paid for illegally induced off-label uses - even though for a lot of people the drugs were effective and didn't cause any adverse effects.

No personal injuries, of course. Just RICO (federal and state), consumer fraud, unjust enrichment, civil conspiracy, fraud, negligent misrepresentation, and a couple of weird claims - "aiding and abetting breach of fiduciary duty" and "equitable accounting" based upon "illicit marketing." Slip op. at 2.

We aren't going to go into the facts because - well this opinion is 72 pages long and we have other work to do.

So we'll go straight to the bottom line. Here are the important legal rulings:

This is another example of how the courts are not letting plaintiffs get away with boilerplate pleading after Twombly. The opinion's standard of review section is essentially all about Twombly. Slip op. at 11-12. That is, except when fraud is involved.

Dismissal of the RICO claims (both federal and state, because plaintiffs pleaded the same supposed facts for both) is for the familiar ground the the plaintiffs have not plead standing to sue/cognizable injury.

The court discerned four claims in the plaintiffs' complaint: (1) economic loss due to off-label promotion; (2) the same sort of loss due to paying for prescriptions for ineffective drugs; (3) yet more economic loss because the TPPs were induced to pay for the drugs when there were cheaper alternatives; and (4) still more economic loss due to paying for more prescriptions and alleged price inflation due to increased demand (this is the fraud on the market theory). Slip op. at 17.

All bogus, ruled the court.

Number 1: Illegal promotion in and of itself isn't something private plaintiffs have standing to sue about. "[T]his theory of injury - injury based solely on the off-label promotion of the [drugs] - is patently illogical and untenable. Slip op. at 19. Why? It would allow recovery where: (1) the off-label promotion was entirely truthful, and (2) when the off-label use was the most effective treatment. Id. This theory is "plainly an impermissible attempt ... to turn violations of the FDCA for off-label promotion into a private cause of action." Id. Off-label promotion is not inherently fraudulent. Slip op. at 20. Instead, where the off-label use was effective, the plaintiffs received the benefit of their bargain and were not injured at all. Id. "The court will not permit Plaintiffs to shoehorn allegations of off-label promotion within the rubric of RICO without pleading the essential RICO elements of injury and causation." Slip op. at 21. Bye-bye off-label use theory.

Agreed 100%. For more of our take on these issues, in the RICO context specifically, see here and here.

Number 2: It's hard to argue a loss from allegedly "ineffective" drugs when there aren't any facts pleaded that plausibly establish the ineffectiveness of the alleged off-label uses. Slip op. at 22. And the kicker: to the extent the TPP plaintiffs allege ineffectiveness, they never tie those allegations to any particular prescription that they paid for. Slip op. at 28-29 (failure to identify who received an ineffective drug). That's the kicker because it's harder for plaintiffs to plead around it - and by its nature it would defeat any kind of class recovery. "[F]ormulaic recitation of of the statutory RICO elements" doesn't cut it anymore. Id. at 23 (citing Iqbal). Pleading injury "requires proof of a concrete financial loss," not "mere injury to a valuable intangible property interest." Id. "Not FDA approved and/or ineffective" doesn't adequately plead actual ineffectiveness. Slip op. at 24. Lack of FDA approval does not establish ineffectiveness. Id. Nor does mere lack of evidence. Slip op. at 25-26.

Plaintiffs' allegations of insufficient evidence and lack of FDA approval are not adequate to plead RICO injury because they fail to assert that the [drugs] were ineffective, unsafe, or somehow worth less than what Plaintiffs paid for the drugs.... [T]here is a clear and decisive difference between allegations that actually contest the safety or effectiveness of [the drugs] and claims that merely recite violations of the FDCA, for which there is no private right of action.

Slip op. at 26. Off-label promotion is "puffery" - not fraud. Id. at 26-27.

To plead injury, plaintiffs would have to plead what actually happened to them - to the beneficiaries they claim they covered. Slip op. at 29-30. "The Complaint simply does not allege that the [drugs] were ineffective, never mind that that the drugs were ineffective for the off-label uses for which they were purchased by [plaintiffs]." Slip op. at 31.

All this means that plaintiffs must plead ineffectiveness affirmatively. See Slip op. at 27. They won't be able to do that, of course, because any large-scale off-label use has to be effective, at least in a significant number of patients - otherwise doctors wouldn't have used the drug in that manner in the first place. In short, the only off-label uses involving enough bucks to sue over have to be effective in some populations. Ineffectiveness is not a plausible theory.

Number 3: An alleged lower-priced alternative is not a viable form of loss where plaintiffs received the drug they bargained for, since "the value of the product that was actually purchased was not diminished." Slip op. at 35. There is no allegation in the complaint that the TPPs were themselves misled, only that prescribing doctors supposedly were. Slip op. at 36. Plaintiffs "failed to adequately plead that any particular consumers or TPP beneficiaries received inadequate or inferior drugs or even worse suffered personal injuries." Slip op. at 38 (citation and quotation marks omitted). See Slip op. at 41 (rejecting argument that off-label uses are "a fortiori not as effective or safe as approved treatments").

And the second point in number 2 applies here as well - failure to plead existence of an equally effective, lower priced alternative with respect to any actual individual situations (not even as to the only rare individual plaintiff). Slip op. at 39-40.

Thus, unless the drug in question was affirmatively inferior in some way, there is no RICO injury for the mere existence of a cheaper road not taken (apologies to Robert Frost).

Number 4: Price inflation "is a classic fraud-on-the market theory" that has been "resoundingly rejected." Slip op. at 42-43.

Other grounds for dismissal:

Plaintiffs' off-label marketing allegations also fail because they inadequately plead causation. "[I]ndividualized inquiry would require the factfinder to determine which off-label prescriptions were written by doctors (and ultimately paid for by plaintiffs) as a direct result of [defendant's] alleged misconduct." Slip op. at 49. Nothing in the complaint even purported to plead any facts of this nature. Slip op. at 51-52 (pleadings "ignore reality"; are "full of holes"). The presence of independent prescribing doctors cuts off causation for reasons of remoteness. Slip op. at 50.

The racketeering allegations - predicated on alleged fraud - are not pleaded with the specificity required under Rule 9(b). Slip op. at 54. No particular communications to the plaintiffs themselves, or to particular doctors or patients, are alleged. Other predicate acts are not causally connected to the plaintiffs. Slip op. at 54-55.

A drug manufacturer's sales subsidiary isn't an independent entity capable of combining with its parent in a RICO "enterprise." Slip op. at 56-59.

A promotional program that is not a natural person or legal entity can't be part of an "association in fact" under RICO. Slip op. at 61-62.

The New Jersey consumer fraud act does not permit fraud-on-the-market theories, slip op. at 63, and plaintiffs allege no other loss theory.

TPPs are not "consumers" for purposes of the New Jersey consumer fraud act, since they do not purchase drugs for their own consumption. Slip op. at 64-66.

Common-law fraud and misrepresentation are not adequately pleaded, for reasons previously discussed. Slip op. at 66-67. Nor is there any allegation that the plaintiff TPPs were intended recipients of any fraudulent statement. Slip op. at 67.

Unjust enrichment and equitable accounting fail for lack of ascertainable loss and remoteness of causation, as previously discussed. Slip op. at 68-69.

Since plaintiffs cannot privately claim illegal off-label promotion, they can't use it to sustain a civil conspiracy claim either. Slip op. at 70.

No facts are pleaded connecting the defendant with any particular doctor, so fiduciary duty claims are insufficiently pleaded. Slip op. at 70-71.

Finally, plaintiffs may replead, but any amendment "should not rely upon allegations that Defendants engaged in the off-label promotion of the [drugs]." Slip op. at 72.

Whew!

Disqualifying An Opposing Expert

2009-07-13T05:00:00.000-07:00

You retain an expert for the defense.

Opposing counsel retains the same expert for the plaintiff.

What then?

This situation occurs more frequently than you'd expect, and it can prompt heated battles.

One example -- although a fairly easy case -- was In re Diet Drugs Prods. Liab. Litig., MDL No. 1203, 2009 U.S. Dist. LEXIS 54580 (E.D. Pa. June 26, 2009). There, Wyeth contacted Steven Kawut, M.D., in October 2006 about the possibility of Dr. Kawut consulting for the defense in the Diet Drug Litigation. According to their later declarations, two lawyers for Wyeth sent Dr. Kawut material in a diet drug case and discussed Dr. Kawut's opinions "on three or four occasions." Id. at *3. The lawyers also told Dr. Kawut Wyeth's "'theories of the case, general and case specific defenses in diet drug litigation,'" case "'themes,'" and "'potential strategies for addressing the opinions of other experts.'" Id.

Another lawyer (from a different firm) representing Wyeth submitted a declaration to similar effect. Id. at *3-4.

And Dr. Kawut had signed a letter agreement with Wyeth to serve as a consultant in a second diet drug case. The letter agreement provided: "Whether or not the agreement is terminated, you may not work for or represent any other person or entity in connection with legal proceedings involving fenfluramine or dexfenfluramine." Id. at *5.

Then Dr. Kawut was designated as an expert for a plaintiff in yet a third diet drug case.

In response to Wyeth's motion to disqualify Dr. Kawut from testifying in the third case, Dr. Kawut submitted an unverified letter, addressed "to whom it may concern," saying that he didn't notice the language in his retention letter "indicating the expectation that my consulting would be exclusively for Wyeth." Id. at *6.

Fish -- obtain barrel!

The legal standard permits experts to be disqualified if they've previously worked for the adversary and obtained confidential information during that employment. In Diet Drugs, the record on that point was awfully strong for Wyeth, and plaintiffs didn't exactly put up a fight by filing only an unsworn letter in response.

Judge Bartle granted Wyeth's motion to preclude Dr. Kawut from testifying for the plaintiff or consulting further with plaintiff's attorneys. Id. at *9.

There are three lessons to be drawn from this case:

First, when moving to disqualify an opposing expert, it's good to have lots of proof on your side. Here, Wyeth submitted the declarations of three different lawyers describing their conversations with the expert, and Wyeth also submitted a signed letter agreement forbidding Kawut from consulting for others.

That's a whole lot better record than folks will have in many of these situations. If one of these motions turns into a swearing contest -- one defense lawyer says he revealed confidences to the expert, and the one expert denies it -- the turf gets awfully mushy. The defendant can't disclose what secrets it revealed to the expert (because, after all, they're secrets) and the judge won't know who to believe. It's good to have multiple witnesses and a signed document on your side.

Second, if you're ever opposing a motion to disqualify an expert on this ground, take it seriously. It's surely worth the effort to obtain a penalty-of-perjury declaration from the expert, rather than just an implausible, and unsworn, letter addressed "to whom it may concern."

Finally, this case didn't raise the truly contentious issue: Whether disqualification of an adverse expert taints the opposing counsel who retained (and worked with) that expert, requiring disqualification not just of the expert, but of opposing counsel as well. If you ever file one of those motions, expect a real battle: Opposing counsel can usually find a substitute expert, but opposing counsel doesn't like to be knocked out of a representation and lose a fee.

There's a pretty large body of law addressing when counsel who worked with a disqualified expert must themselves be disqualified. If you're ever in this situation, study that law, examine the evidentiary basis for your motion to disqualify both the expert and opposing counsel, and, if you choose to file the broader motion, gird your loins for a battle royale.

ADE Reports: Redaction Required

2009-07-10T12:45:00.000-07:00

Yes, Virginia, the FDA's regulations requiring redaction of physician identifying information from Adverse Drug Event ("ADE") reports are mandatory - even if plaintiffs obtain them ... well ... irregularly.

That's the lesson of a brand new discovery decision in In Re Mentor Corp. Obtape Transobturator Sling Products Liability Litigation, 4:08-MD-2004, slip op. (M.D. Ga. July 10, 2009), decided earlier today.

Here's what happened. Certain "former employees" of an overseas affiliate of the defendant turned over unredacted ADE reports to the plaintiffs. We'll leave the characterization of what happened at that. The defendant claimed that the ADEs were privileged to the extent that FDA regulations - expressly preemptive of civil litigation - required redaction of the identities of the of the physicians who filed the reports.

Plaintiffs resisted, claiming: (1) since the irregularly obtained copies had not been "submitted to the FDA" they could keep the full copies, (2) that they should get full copies of any report concerning a plaintiff, and (3) some of the reports were from overseas, and those reporting physicians weren't entitled to protection.

The court responded: "no and hell no."

Plaintiffs' attempt to split hairs with the expressly preemptive FDA regulation failed. The court agreed that:

[T]he policy underlying the regulation is so vitally important to the FDA’s voluntary reporting system that the regulation’s prohibition on disclosure extends to formal and informal voluntary reports of device complaints, regardless of whether such reports were ultimately transmitted to the FDA.

Slip op. at 7. The court thus eliminated any incentive for plaintiffs to acquire copies of reports irregularly before they were submitted to the FDA.

Interestingly, in supporting this conclusion, the Ob Tech court gave "considerable deference" to the positions stated by the FDA in an amicus brief the Agency filed in 1999. Slip op. at 9-10 & n.5. Here's the money quote on the merits, mostly taken from that brief:

The FDA reasons that because a person who voluntarily lodges a complaint with the manufacturer may not know how or whether his complaint will be forwarded to the FDA, “FDA’s interest in protecting voluntary reporter and patient confidentiality, and in protecting voluntary reporting from the pressures of litigation,” applies with equal force to all “complaints,” regardless of whether the complaint triggers the manufacturer’s mandatory reporting obligations.

Slip op. at 10 (quoted parts from FDA amicus brief).

This goes to show, that whatever the Supreme Court thought about the positions the FDA took in Levine, that opinion did not somehow create any sort of blanket rejection of all deference to FDA positions - amicus or otherwise - in all situations.

So the identities of reporting physicians remain sacrosanct, no matter when the report was made, or when (if ever) that report was sent to the FDA. Slip op. at 11. And all physician reports of adverse events are covered, because they are all voluntary under FDA's regulations. Slip op. at 13.

Umm ... there's one caveat. Because the FDA regulations don't apply to entirely overseas transactions, reports filed with a European subsidiary by European doctors weren't protected - at least not by FDA regulations. Slip op. at 8. We'll leave that where it lies, because we're not experts on EU medical privacy directives.

After ADE issue was resolved, the court went on to address some document-specific attorney/client privilege issues. Slip op. at 17-22. The moral there is this: If you want a document to be kept confidential, you damn well better put some sort of confidentiality designation on that document. The defendant won the documents that had such a designation from the get go - and lost as to those that didn't.

But the generally applicable, and thus more important aspect of the Ob Tape decision is this: we can keep confidential the identities of physicians who voluntarily report adverse drug and device events - before, during, and after those events are reported to the FDA. And even if they somehow get their hands on them, plaintiffs can't keep them.

Kudos to John Lewis, Pearson Bownas, and Brad Harrison of Jones Day for achieving this victory, and making some new law.

Taking Stock

2009-07-09T11:54:00.000-07:00

The two of us have been practicing law now for a little over 25 years. Bexis graduated law school in 1982 and Herrmann a year later (see our bios - links at the top - for the gory details). At big firms it takes a few years – five at least – before we could start to have any real strategic impact on the cases we were working on. And it took a few years for us to get around to being product liability defense lawyers in the first place.

But now we’re here, there, whatever.

We’ve been doing product liability defense for the better part of a couple of decades, and we’ve got maybe a couple of decades more to go. So how are we – not just us, but this generation of the defense bar generally – doing at this midpoint of our careers?

Bottom line: Are our clients better off now than when we started?

We decided today was as good a time as any to take stock.

Class Actions

Grade: A. Back in the late 1980s, we had to take class actions in product liability litigation very seriously. While there were never a lot of certifications, there were enough of them that – during the Bone Screw litigation, for example – plaintiffs would argue that there was some sort of “modern trend” favoring certification of personal injury class actions. Some courts said so, too. See In re A.H. Robins Co., 880 F.2d 709, 738 (4th Cir. 1989) (later abrogated). We remember how relieved we were to beat the class certification motion in Bone Screw, which kept that litigation from posing an even more existential threat to our clients than it already did.

Then our side prevailed in Amchem Products, Inc. v. Windsor, 521 U.S. 591 (1997), and Ortiz v. Fibreboard Corp., 527 U.S. 815 (1999). After that – with a lot of blood, sweat, and good legal argument from our side – class actions (at least successful ones) largely disappeared from mass torts, as we’ve discussed before. The few courts willing to certify class actions in drug and medical device cases have so far gotten shot down on appeal, most recently in the St. Jude litigation. Zyprexa may follow. And with the enactment of CAFA, most class action decisions going forward, and essentially everything in mass torts, will be made by federal courts applying post Amchem/Ortiz law.

Medical monitoring, a non-personal-injury derivative of personal injury causes of action that the plaintiffs’ bar dreamt up with class actions in mind, has largely failed in recent years to produce very many successful certifications – despite lots of attempts. We collected those cases here.

Likewise, class actions involving purely economic losses, usually brought as adventurous applications of consumer fraud, RICO, or warranty claims, have had rough going. The first round of appeals in St. Jude recognized the key argument: Even if a given consumer fraud statute does not require the individualized element of reliance, defendants may disprove causation with individualized evidence of non-reliance.

As a measure of how far out of the mainstream tort class actions have become over the last couple of decades, the ALI’s Aggregate Litigation principles project, for all its pro-plaintiff leanings in other areas of the law, states quite clearly that personal injury class actions are disfavored for a variety of reasons.

There’s also a distinct trend afoot, not limited to tort cases, to tighten consideration of class action allegations. The old rule of no "merits" consideration during class certification is out the window.

To top it all off, our side has also had a good deal of success arguing against cross-jurisdictional class action tolling - that failed class actions filed in one court should not toll the statute of limitations on claims filed in a different court. That deprives failed class actions of the one substantive benefit that they could confer upon plaintiffs (as opposed to their lawyers).

We’re still litigating a few issues, such as whether punitive damages can ever be assessed on a classwide basis – discussed here – but overall our clients are a lot better off on the class action front now than they were when we got into this business.

Expert Witnesses

Grade: A. Back when we got started, the courts waved through just about any garbage that a plaintiff’s expert wanted to say. See Wells v. Ortho Pharmaceutical Corp., 788 F.2d 741, 744-45 (11th Cir. 1986) (allowing testimony with no epidemiologic or other statistically significant support that spermicide, of all things, caused birth defects).

Then along came Daubert v. Merrrell Dow Pharmaceuticals, Inc., 509 U .S. 579 (1993). For a while there, it was touch and go. Daubert could have been interpreted as loosening the already capacious federal standard for expert certification even further. But the good guys, again through a lot of hard work and inspired argument, were able to gain the upper hand in this area. The most important thing wasn’t really the standard itself, but the concept of the judge – not the jury – as “gatekeeper.” Given the amount of junk science that plaintiffs’ experts were spewing, if we could just get courts believing that they had an obligation to review things critically, we would win.

And we did, although it took several return trips to the Supreme Court to nail it down. See General Electric Co. v. Joiner, 522 U.S. 136 (1997); Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999); Weisgram v. Marley Co., 528 U.S.440 (2000).

Daubert was a drug case. It was the Bendectin litigation’s lasting gift to the legal profession.

After a while, the Daubert divide’s gotten to be like night and day. We don’t win every case, but we win a lot more of them than before. Nineteen years after Wells, the same court decided McClain v. Metabolife International, Inc., 401 F.3d 1233 (11th Cir. 2005), reversing and requiring judgment n.o.v. where an expert relied on little more than temporal association. That's monumental change for the better.

And the most important part of Daubert – stringent substantive review of expert opinions, by whatever name – is increasingly finding its way into state court decisions as well, in places like New York, Texas, and Pennsylvania.

So this is another area where we think that, after twenty-plus years of our laboring in the litigation vineyards, our clients are a lot better off.

Pleading

Grade: A- (due to incompleteness). We’ve been all over Ashcroft v. Iqbal, 129 S. Ct. 1937 (U.S. 2009), and Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), on this blog.

For good reason.

Before these decisions, the federal pleading standard was a joke. Plaintiffs could survive a motion to dismiss without pleading a single actual fact, only the same boilerplate they could repeat over and over again in thousands of identical complaints, with only the names changed to encourage the greedy.

Under the new plausibility standard, so far it looks like things will get better. We haven’t done a complete survey by any means, but we do analyze post-Riegel device preemption cases, and a lot of those are being decided on motion to dismiss lately. Under the new pleading standards, the courts aren’t buying boilerplate allegations of “FDA violations” any longer – and cases are getting dismissed (or not refiled). That's immediate, concrete improvement.

We’re hoping that carries over to other allegations having nothing to do with preemption, such as feasible alternative design, warning causation, and reliance.

If our side can continue to build on Iqbal and Twombly the way we have with the Supreme Court’s favorable class certification and expert admission decisions, maybe we can force the other side to abandon their word processors and actually have to evaluate the facts relevant to each of their clients before filing suit.

So with respect to pleading, our clients are already better off – and could be a lot better off – than they were when we first got our seats at the table.

Learned Intermediary Rule

Grade: A-. The minus is due to the wrongheaded decisions of one state supreme court and a federal district court ignoring state precedent, undermining the learned intermediary rule in a couple of smaller states.

The A is due to the number of states that have adopted the learned intermediary rule since the mid-1980s. Take a look at the chart we did a while ago on who’s adopted the learned intermediary rule. In 1987 sixteen state supreme courts had adopted the rule. We’re up to 33 now, with the addition of Wyoming after that post was written. Three more states, including Texas, have had their supreme courts adopt the rule in cases not involving drugs or devices. Federal courts have predicted adoption in three more states.

Personally, we’ve been involved in state supreme court decisions either adopting or reaffirming the learned intermediary rule in Pennsylvania, Ohio, New Jersey, Connecticut, Kentucky, Texas, and Georgia.

Beyond simply the number of states adopting the learned intermediary rule, we’ve also seen a strong trend towards its expansion in various directions. It’s expanded from drugs to medical devices. The rule has grown from adequacy of warnings to whether an allegedly defective warning had any causal effect. It’s expanded from failure to warn claims to other claims such as consumer fraud. The rule has been increasingly adopted to protect entities like pharmacists, in addition to product manufacturers.

And because the learned intermediary rule requires that warnings be viewed from the perspective of medical professionals, courts have increasingly been requiring expert testimony as to warning adequacy.

So far, even when the other side tries their own version of “tort reform,” they haven’t really gotten anywhere trying to repeal the learned intermediary rule legislatively - at least not yet. "Constant vigilance."

So with the learned intermediary rule as well, we’d have to say that our clients are quite a bit better off now than when we started in this business.

Preemption

Grade: B. What? Didn’t you guys just get hammered in Wyeth v. Levine, 129 S. Ct. 1187 (2009)?

Yeah, and our ears are still ringing.

But back 20+ years ago, who’d ever heard of preemption in a product liability case to begin with? When we got started, preemption was nowhere.

We were on the barricades in the first wave of preemption litigation, in vaccine cases. We got clobbered.

We were back on the barricades in the second wave of preemption litigation. We had just gotten most of the Bone Screw litigation thrown out on preemption grounds, see In re Orthopedic Bone Screw Products Liability Litigation, 1996 WL 221784 (E.D. Pa. April 8, 1996), when we got clobbered again in Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996). So we’re sort of used to it.

But we’ve got some degree of prescription drug preemption after Levine, with the boundaries still to be fleshed out. In Riegel v. Medtronic, Inc., 128 S. Ct. 999 (2008), we won extensive preemption with respect to pre-market approved medical devices – a minority of all devices, but a category including a lot of the most important devices that would be most adversely affected by litigation as usual. Maybe best of all, preemption precludes the other side from standing up in front of juries and alleging that our client lied to the FDA in its regulatory submissions. Buckman Co. v. Plaintiffs’ Legal Committee, 531 U.S. 341 (2001).

So we haven’t gotten the home run with preemption that we hoped, but considering that back in the late 1980s preemption wasn’t even an affirmative defense worth pleading, our cohort has made significant gains for a significant number of clients.

Prevention of Innovative Liability Theories

Grade: B-. When we started market share liability was a major threat to burst its DES bounds and become generally accepted. That hasn’t happened. No state has adopted it since Hawaii in 1991, and some of the states that did so earlier, like New York, have tightly confined it to the original DES set of facts. Score one for the good guys.

Public nuisance is also appearing more and more like a bad idea whose time has passed. It got a little traction with some pro-plaintiff courts in gun litigation, but not that much. Lately the theory – when asserted in product liability litigation – has taken its lumps in lead paint litigation. Public nuisance has gotten nowhere in drug and device litigation. Two-zip to the good.

The third Restatement of Torts, adopted in 1997 and published the following year, cut back on some of the loopier aspects of strict liability, including liability for unknowable risks, and failure to recall/retrofit claims.

We’ve largely kept an independent duty to test out of the law, too.

And fraud on the FDA is preempted (see above).

But on the other side of the ledger, consumer fraud claims have become staples of our opponent’s litigation strategy, and thus banes of our existence. Twenty years ago practically nobody ever encountered them. So that’s not so good. Still, since consumer fraud claims are limited to economic damages, they’re not worth very much unless the plaintiffs can find some way of aggregating them. See our earlier discussion of class actions. So the jury’s still out on how useful those claims will be for the other side in the long run.

New Jersey, a drug tort hotbed, recently put the kibbosh on consumer fraud claims in product liability actions – that’s good.

Even better, our side's been able to convince most courts that such statutes can’t be enforced extraterritorially, outside of the state that enacted a particular statute. That cuts down on the size of any attempt to aggregate claims.

The learned intermediary rule helps, too, since physicians make individualized risk/benefit decisions in deciding to prescribe drugs and devices. That fact tends to preclude litigating these cases as class actions. So does the additional fact that most drugs and devices – how shocking! – actually help people. People who took a drug or used a device, got the benefit, and didn’t suffer an adverse side effect haven’t been injured. Fact of injury thus becomes another individualized determination that has prevented class actions.

We’ve also had a see-saw battle with negligence per se claims based upon alleged FDCA violations. Most of the older cases that were around when we were getting started allowed those claims without a lot of discussion, because after all the FDCA was enacted to make products safer, wasn’t it? However, the principle that the FDCA prohibits plaintiffs from privately enforcing the statute against violators, enunciated by the Supreme Court in Buckman, has helped our clients defeat those claims more often in recent years. But negligence per se hasn't yet gone the way of the dinosaurs, and some courts have allowed such claims.

Something else we didn’t see much of twenty years ago was the so-called post-sale duty to warn. That’s proliferated quite a bit, as even the Third Restatement included it. Fortunately, we don’t see all that much of post-sale claims in our neck of the woods.

Another negative we have to admit is that on our watch medical monitoring went from a legal peculiarity to, if not a majority rule, at least being allowed by a fair number of states, as our 50-state survey shows. So we haven’t been able to stop that one either.

All this adds up to a mixed record in beating back the various novel theories of liability that plaintiffs have invented over the years. We’ve gotten rid of some altogether, and limited others. But some geniis have escaped from the bottle despite the best efforts of our generation of defense lawyers.

Discovery

Grade: D. Two words: “electronic discovery.” Twenty years ago, when we were starting to move into responsible positions, nobody had ever heard of it.

Now electronic discovery has gotten entirely out of hand. It’s hideously expensive, ridiculously intrusive, and almost entirely a one way street. Tort plaintiffs don’t often have large, frequently upgraded computer systems.

Everything else that our side’s been able to accomplish in limiting or streamlining discovery – routinized plaintiff questionnaires, federal-state coordination, restrictions on apex depositions, the inadvertent production doctrine, etc. – pales by contrast to the constantly metastasizing disaster that is electronic discovery.

Reducing Overall Litigation

Grade: F. It hasn’t happened. The other side has been more efficient in soliciting large numbers of plaintiffs to populate the ever growing number of pharmaceutical and medical device mass torts than our side has been in stopping them. The racket that mass torts have become is so downright predictable that we parodied it a while back.

But beneath that parody is lies the simple fact that, since the Supreme Court’s first benighted decision in Bates v. State Bar of Arizona, 433 U.S. 350 (1977), extending First Amendment protection to lawyer advertising, the other side’s solicitation machines have become more and more effective, and there’s not a constitutional thing we can do about it. Even when our side gets a crumb from the Supreme Court, such as Florida Bar v. Went For It, Inc., 515 U.S. 618 (1995), upholding a trivial 30-day cooling off period from personalized solicitations, the vote was only 5-4.

As long as society tolerates virtually unlimited lawyer solicitation as a constitutional right, there’s not a lot of ways for our side to close the litigation floodgates.

Not that we haven’t tried; it’s just our side’s efforts to stop the onslaught of boilerplate, virtually uninvestigated filings hasn’t accomplished very much. Lone Pine orders are a handy invention, but they have yet to become routine, as, say, the litigation hold memos our side has to put up with. Rule 11 once had possibilities, but too many lawyers on both sides played games with it, so in 1993 the Advisory Committee defanged it. That rule hasn't been a significant factor since.

Maybe we’ll have better luck requiring individualized showings of “plausibility under Iqbal/Twombly, but that’s still in the future.

For the present, and over the past twenty years, the number of mass torts, and the number of plaintiffs involved in mass torts, has grown steadily. The list of federal court product liability MDLs maintained by the Judicial Panel on Multi-District litigation is one way to measure it. There was never more than one new drug/device MDL created per year (and in a lot of years, none) until 2001, when Baycol, PPA, Silzone, and ProteGen were all created. Then: 2002-0; 2003-1, 2004-2, 2005-4, 2006-8; 2007-3; 2008-10. Not a trend to be proud of.

If everything that we do is ultimately supposed to deter future litigation against our clients, then it hasn’t worked at all.

So we flunk ourselves on that one. Maybe the next generation of defense lawyers can do better.

Blogging About Blogging

2009-07-08T12:10:00.000-07:00

Want to get noticed in the legal blogosphere?

Blog about legal blogging!

Herrmann went off on a frolic and detour (from drug and device law) in a couple of recent posts, first noting that none of the ten firms with the highest profits per partner sponsored blogs and then speculating about why that's so.

The blogosphere lit up like a Christmas tree!

And Herrmann can't resist jumping back into the fray, with this third post on the subject.

Two big firm bloggers have now chimed in: Paul Karlsgodt (of the Class Action Blawg and Baker & Hostetler) defends the benefits of big firm blogging, and Francis Pileggi (of the Delaware Corporate and Commercial Litigation Blog and Fox Rothschild) explains the benefits that blogging bestows on him.

Zach Lowe, over at AmLawDaily, did the kind of thing that reporters do: He called the managing partners of the high profits-per-partner firms and asked why they didn't sponsor blogs. Jonathan Schiller, managing partner of Boies Schiller, was blunt: "I think the lawyers here are just too busy," he says. "I'm too old to blog. I'd rather play golf if I have a bit of free time."

It's a shame that Zach didn't ask the follow-up question: Does that go for all business development efforts, or just for blogging?

That is: "Jonathan, you've been solicited to write a by-lined piece in the Wall Street Journal. Do you accept, or shall we tell the Journal that you'd rather golf than write?" Or: "Jonathan, you've been invited to give the keynote address at the annual meeting of the Association of Corporate Counsel on Saturday morning. Do you accept, or will you be keeping your tee time?"

To our eye, there's a world of difference between saying, on the one hand, "I don't have time for any business development activities" (which may be crazy in today's hypercompetitive world) and saying, on the other hand, "I don't have time for blogging as a business development activity, because I don't get a large enough return on my investment" (which may be entirely rational).

In large part, whether blogging makes sense as a business development tool may depend on what business you're trying to attract.

Here's a blogging self-assessment quiz:

You've just gotten a phone call from a new client who wants to retain you for a new matter that is likely to generate $10,000 in fees. What's your reaction?

A. "Thank God! Now I have something to do!"

B. "Eureka! If I score another dozen just like this one, it'll be a banner year!"

C. "Refer it out. It's not worth doing a conflict check for 10 grand in fees."

If you answered A or B, blogging may be a great business development tool for you. If you answered C, blogging may yield a far less attractive return on investment.

Other reactions to our blog posts about blogging included Ron Friedmann at PrismLegal (failing to blog is a terrible mistake being made by big firms), Robert Ambrogi at Legal Blog Watch (repeating the arguments that we'd heard, but not really commenting on them), and the ABA Journal (simply reporting on the fireworks in the blogosphere over this issue).

As for us, we continue to think that blogging yields many benefits -- personal satisfaction, a raised professional profile, participating in the public debate, becoming a central clearinghouse for information, and the like -- but its value as a business development tool for lawyers at large firms remains unproven.

The two of us blog for love, not for money.

But let the fireworks continue (while we head back to drug and device law, where we belong)!

What's up with Colacicco?

2009-07-07T08:30:00.001-07:00

The last time we looked at the long-running Colacicco saga, the Third Circuit had vacated its 2007 decision and remanded the preemption issue back to the district courts. As to the Colacicco half, Judge Baylson has issued an order detailing how reconsideration of the preemption issue (and other issues) is to proceed. The court envisions discovery on preemption - which should eliminate any concerns over the completeness of the record - to be completed by the end of September, 2009. The order also provides a summary judgment schedule looking to a new preemption decision by the end of the year. That's not just our speculation. The order (¶6) actually states "The Court intends to rule on this issue before the end of the year."

There are a couple of other interesting things about this order. First, it mentions (¶1) that the pioneer manufacturer, which did not make the drug that the plaintiff took, is out of the case. That eliminates state-law issues concerning causation and product identification. Those are serious alternative state-law grounds for dismissal, as we have discussed before. The dismissal puts the preemption issue front and center.

Second, the court is quite explicit on the issue it is interested in deciding:

In preparing any motion on the preemption issue, counsel for Apotex shall keep in mind the narrow issue, as articulated by the Supreme Court in Wyeth v. Levine, 129 S. Ct. 1192 (2009), that the drug manufacturer bears the burden of showing by “clear evidence that the FDAwould not have approved a change to [the drug]’s label.” Id. at 1198.

Order ¶6. That proviso tells us that the court is interested narrowly in the issue of SSRI preemption - whether the administrative record demonstrates that the FDA had looked at SSRIs and suicide and already made up its mind what the warning was supposed to say. Conversely, the court does not seem interested in the issue of generic drug preemption, which as we've discussed on a number of occasions, focuses on whether the generic manufacturer has control over its own label, given the statutory requirement that generic labels be the "same" as pioneer labels.

Finally, while it's not reflected in the order itself, according to a report we received on the hearing, Judge Baylson indicated that he doesn't think Levine adversely affected his prior finding of preemption. We don't think so either.

Daubert Gives Plaintiffs A Pain In The Pump

2009-07-07T05:00:00.000-07:00

Last year, the MDL Panel denied an attempt to centralize all of the federal "shoulder pain pump - chondrolysis" cases. See In re Shoulder Pain Pump – Chondrolysis Products Liability Litigation, MDL No. 1966 (JPML Aug. 11, 2008) (link here). So the cases have moved ahead individually in federal courts across America.

A couple of weeks ago, a defendant got good news in one of those cases. In Kilpatrick v. Breg, Inc., No. 08-10052-CIV-MOORE/SIMONTON, slip op. (S.D. Fla. June 25, 2009) (link here, courtesy of the Products Liability Prof Blog), Judge K. Michael Moore found that plaintiff's proffered proof of general causation linking a pain pump to chondrolysis didn't satisfy Daubert, which doomed the plaintiff's case.

Kilpatrick operated a charter fishing guide service in the Florida Keys. He underwent arthroscopic shoulder surgery to repair the ring of tissue surrounding the shoulder socket. To control post-operative pain, the surgeon implanted a shoulder pain pump manufactured by Breg.

A couple of years later, Kilpatrick's shoulder started to hurt again. His physician diagnosed him with glenohumeral chondrolysis -- a breakdown of the cartilage in Kilpatrick's shoulder joint. Kilpatrick ultimately had to undergo a total shoulder replacement.

Kilpatrick filed the customary complaint -- a few product liability counts, negligence, and alleged violation of the Florida Deceptive and Unfair Trade Practices Act. Breg filed a motion for summary judgment on the ground that Kilpatrick didn't demonstrate that its pain pump could cause the type of injury Kilpatrick suffered.

Judge Moore agreed.

Kilpatrick seems to have hired a real doctor as an expert witness: Gary Poehling, M.D., a long-time orthopedic surgeon and professor of orthopedics who had served as editor-in-chief of a leading orthopedics journal. But there wasn't any science to back up Dr. Poehling's opinion that a pain pump could cause chondrolysis.

Poehling relied on four published articles to support his general causation opinion.

The Hansen study examined 152 patients who underwent 177 shoulder surgeries. Only 19 shoulders in 17 patients "had bupivacaine-dispensing pain pumps inserted in them." Slip op. at 9. "Of those, twelve shoulders in ten patients developed chondrolysis." Id. The Hansen study, however, included no statistical analysis and thus didn't demonstrate statistical significance or whether it was "statistically meaningful to extrapolate from the relatively small sample size." Id. Additionally, the study acknowledged that "[t]hermal and/or radiofrequency, suture material, and reabsorbable suture anchors may have played a role not yet completely understood" in causing the chondrolysis. Id. And neither the Hansen study nor Dr. Poehling could explain "why nearly 40% of patients treated with pain pumps did not develop chondrolysis," id., leaving "an unexplained 40% error rate in Poehling's hypothesis." Id.

So much for the first, and strongest, of the four studies that Poehling relied upon.

The Gomoll study was a controlled study of rabbits. The court noted the many difficulties in animal studies and rejected the Gomoll study as proof of general causaion in humans. Id. at 11.

The Greis report, a case study of two female swimmers, recognized on its face that "the exact cause of the chondrolysis remains unknown." Id. at 12. Moreover, "anecdotal reports of two individuals are, of course, not statistically significant evidence of causation." Id.

And Dr. Poehling's own 228-word editorial said nothing about general causation and in fact acknowledged that "'idiopathic' chondrolysis -- that is, chondrolysis caused by unknown factors -- has also been described in the medical literature." Id. at 12-13.

Absent scientific evidence of general causaion, the court could have stopped there.

But it didn't.

It went on to note that Poehling said nothing about the background risk of chondrolysis and conceded that the scientific literature has not reached a conclusion about the cause of chondrolysis. Id. at 13-15. Finally, Dr. Poehling's differential diagnosis, ruling out other causes of Kilpatrick's chondrolysis, could not overcome the absence of evidence proving that the pain pump could have been the cause. Id. at 16.

There was thus no evidence linking the pain pump to Kilpatrick's injury, and all of his causes of action failed.

Perhaps "pain pumps" will prove to be another example of a mass tort that wasn't.

More On Big Firm Blogging

2009-07-06T05:00:00.001-07:00

A couple of weeks ago, Herrmann noted in passing that, although many big firms now sponsor blogs, none of the ten firms with the highest profits per partner (that much-despised, but oft-cited metric) do.

You don't have to say much to set off an avalanche in the blogosphere.

Many folks contacted us, on or off-line, to suggest why lawyers at the most profitable firms don't blog.

We're staying out of this fray, but we offer for your consideration the six things we heard:

1. Lawyers at the most profitable firms are stupid:

"'Profitable' large law firms don’t see the need or the benefit of doing blogs. Clearly, if they are already doing well, why go to the trouble and work involved in blogging, when too many BigLaw lawyers still believe that the work will always be there. A mistake of course, but a perception nonetheless."

2. Lawyers at the most profitable firms are too busy:

"The reason they are so profitable is that everyone is working their heads off – nobody has time to blog."

3. Lawyers at those firms won't stoop to blog:

"They are so profitable that they don’t think they need to stoop to marketing (which is what they think blogging is)."

4. Lawyers at those firms don't want to give away their product for free:

"Lawyers at the top ten PPP firms wouldn’t want anyone at the firm to blog because they might divulge the firm’s precious secrets."

5. Lawyers at those firms lack the necessary skill set:

"Those high-profit firms are so profitable because they are very good at making money, but the skill sets required for being good at making money may not be the same as the skill sets required to blog."

6. Lawyers at those firms correctly believe that blogging is unlikely to yield a decent return on investment because of the nature of the firms, the work they do, and their clients:

"When your firm name is already well known and your reputation that well established, you wouldn't add any value by blogging."

As we said, we're staying out of this fray. Although we have a pretty strong opinion on this subject, we're keeping it to ourselves. But we thought we'd share with you the competing possibilities that had come over the transom.

Whither The Heeding Presumption?

2009-07-02T12:18:00.000-07:00

About a month ago, the Nevada Supreme Court took a look at the so-called “heeding presumption” – and rejected it outright. Rivera v. Philip Morris, Inc., ___ P.3d ___, 2009 WL 1563373 (Nev. June 4, 2009). Not only that, the decision was unanimous. Obviously, given the caption, Rivera wasn’t a drug or device case (which is why we didn’t jump on it right away). But, like drugs and devices, cigarettes have inherent risks that cannot be designed away. So some of the arguments we’ve used against the heeding presumption in drug cases would apply to cigarettes. Indeed, the degree of public knowledge concerning risks in cigarette cases is much greater than in the average drug case. So it may be that cigarettes represent an a fortiori situation.

But an unavoidably unsafe product analysis wasn’t the Nevada Supreme Court did in Rivera. The court didn’t split the baby like some courts have done – limiting the presumption to certain types of products or kinds of situations. Rather, Rivera rejected the heeding presumption entirely, as against all defendants in any case. That’s worthy of our attention, even though the subject matter is outside of our sandbox.

Rivera’s facts aren’t all that unusual; a typical smoking case with allegations of inadequate warnings about the risks of smoking. The defendant tobacco company moved for summary judgment on the warning claim, which was denied. The trial court interposed a heeding presumption, and stated that the defendant had not overcome it. 2009 WL 1563373, at *2. However, since the case was in federal court, Nevada procedure permitted certification of controlling questions of law to the Nevada Supreme Court. That’s what happened with the heeding presumption. Id.

The Rivera court first stated the general rule: “the burden of proving causation can be satisfied in failure-to-warn cases by demonstrating that a different warning would have altered the way the plaintiff used the product or would have prompted plaintiff to take precautions to avoid the injury.” 2009 WL 1563373, at *4. That’s essentially the same standard we use in our drug cases to win summary judgment in learned intermediary cases based upon independent physician knowledge and other doctor-related facts that preclude causation.

The heeding presumption, however, “departs from well-settled and established Nevada law.” Id. It would change the burden of production on warning causation:

Instead of requiring that the plaintiff prove each element of a strict product liability case, a heeding presumption removes the plaintiff’s responsibility to carry the initial burden of production as to the element of causation. A heeding presumption “allow[s] the fact-finder to presume that the person injured by product use would have heeded an adequate warning, if given. Therefore, a heeding presumption shifts the burden of production from the plaintiff to the manufacturer, who must rebut the presumption by proving that the plaintiff would not have heeded a different warning.

Id. (various citations and quotation marks omitted).

The court didn’t want to go there. First, it got rid of a couple of cases plaintiffs advanced by construing them as holding no more than, under the facts, the plaintiffs could have met their burden of proving causation. 2009 WL 1563373, at *5.

Then it turned to the crux of the heeding presumption – the language in Restatement (Second) of Torts §402a, comment j (1965): “[w]here warning is given, the seller may reasonably assume that it will be read and heeded; and a product bearing such a warning, which is safe for use if it is followed, is not in defective condition, nor is it unreasonably dangerous.” Courts adopting the heeding presumption claim, as a some sort of symmetry, that a plaintiff presumptively would have followed a non-existent adequate warning.

That argument, of course, puts the rabbit squarely in the hat, because the comment j language really doesn’t give defendants anything. After all, if the warning is adequate, as the comment, postulates, the defendant doesn’t even need to get to causation to win. The defendant wins because there was nothing wrong with its warning – whether anybody read them or not. That means there’s really no “symmetry” or “corollary” at all. Instead, the heeding presumption effectively gives plaintiffs something of significant value (shifting the burden of, at least, production, on causation) for nothing (cases the defense wins anyway on adequacy of warming).

But we digress.

The Rivera court held that, while it had agreed with other parts of comment j in the past, in Allison v. Merck & Co., 878 P.2d 948 (Nev. 1994), it had not adopted all of comment j, and specifically had not adopted the language about presumed reliance upon warnings. 2009 WL 1563373, at *5 (“the manner in which we have previously cited to comment j indicates that we will not stray from the principle that the plaintiff carries the burden of production of the element of causation”). Coincidentally, Allison is the case where, when the votes of a splintered court are added together, a majority of the court followed the learned intermediary rule.

After discussing Allison, the court in Rivera comes out and says it: “It is a firmly rooted part of Nevada law that the plaintiff in a strict product liability case bears the burden of proving all the elements of his case, including causation.” 2009 WL 1563373, at *6. Rivera cites several other cases from around the country that refuse to adopt the heeding presumption. Id. (citing Riley v. American Honda Motor Co., 856 P.2d 196, 200 (Mont. 1993); DeJesus v. Craftsman Machinery Co., 548 A.2d 736, 744 (Conn. App. 1988); Harris v. International Truck & Engine Corp., 912 So.2d 1101, 1109 (Miss. App. 2005)).

Rivera also rejected the heeding presumption on public policy grounds. It's basis was somewhat unusual. The court concluded that it didn’t really like warnings very much, and that manufacturers should instead be encouraged to design products differently:

[W]e strongly adhere to the principle that a manufacturer must make products that are not unreasonably dangerous, no matter what instructions are given in the warning. Therefore, we conclude that it is better public policy not to encourage a reliance on warnings because this will help ensure that manufacturers continue to strive to make safe products.

2009 WL 1563373, at *6. We're not sure how we feel about that rationale, as there are a lot of product risks – in cigarettes, and in prescription drugs – that simply cannot be designed away. That’s what the unavoidably unsafe product concept is all about.

One thing we don’t have any qualms over, however is the court’s alternative policy ground, recognizing that presuming even adequate warnings will be heeded is an out and out fiction:
[I]t is not logical to presume that a plaintiff would have heeded an adequate warning, if provided. Warnings are everywhere in the modern world and often go unread or, where read, ignored.
Id. (citation and quotation marks omitted).

Rivera got us thinking about the heeding presumption generally. We’ve examined it previously, but that was limited to the context of prescription drugs and medical devices. We also discussed Ackermann v. Wyeth, 526 F.3d 203 (5th Cir. 2008), a case both of us had a hand in (it was Herrmann’s case, and Bexis contributed an amicus brief). Ackermann wiped out the heeding presumption in prescription drug cases brought in Texas:

Further, we doubt the Texas Supreme Court would apply such a presumption here, when it would not serve its intended purposes. . . . In the learned-intermediary context, however, it is [the prescriber], not [the plaintiff], who had to testify about his decision to prescribe [the drug. . . .] [T]o “read and heed,” in the context of a learned intermediary, means only that the physician would have incorporated the additional risk into his decisional calculus.

526 F.3d at 213. See also Thomas v. Hoffman-LaRoche, Inc., 949 F.2d 806, 814 (5th Cir. 1992) (no presumption in unavoidably unsafe products because the effect of a presumption on an inherent risk would be to presume that nobody would ever use the product); Lineberger v. Wyeth, 894 A.2d 141, 145, 149-50 (Pa. Super. 2006) (heeding presumption limited to products involuntarily encountered in the course of a plaintiff’s employment).

But while we’ve considered the presumption’s applicability with respect to unavoidably unsafe products, we’ve never considered the existential question of “to heed or not to heed, is there a presumption?” Apologies to The Bard for that one.

We’ll do that now.

As we expected, the Nevada Supreme Court in Rivera cited most of the best cases. In Riley, the Montana Supreme Court methodically shot down the various “policy” arguments that were advanced in support of the heeding presumption:

First, the dissent contends that it is “common sense” that if an adequate warning is given the plaintiff would have read and heeded it. While this might be common sense in an ideal world, our own experience does not support it; warnings are everywhere in the modern world and often go unread or, where read, ignored. We conclude that the presumption is not appropriate running in either direction, to the manufacturer/seller where a warning is given or to a plaintiff where it is not.

856 P.2d at 200. That sounds like “common sense” to us. We don’t read every warning that we encounter – and we’re defense lawyers. Like Riley, we don’t think anybody else does either.

Next, the dissent raises the perceived difficulties involved in requiring a plaintiff to establish the causation element. We note that the evidence required to establish this element is not qualitatively different than other testimony given by a party in support of her or his prima facie case. Concerns that the testimony may be speculative or self-serving and that a plaintiff may die before the testimony is given are not unique to this cause of action.

Id. We’d go a step further. If plaintiffs are inclined to commit perjury in support of possible recovery, that’s no reason at all to reward them by shifting the burden of proof.

Finally, the dissent argues that the presumption is consistent with the policy behind strict products liability. This may be so; so too would many other changes in a plaintiff's burden of establishing a prima facie case-including the elimination of any burden at all-be consistent with that policy. We are unwilling to shift the respective parties’ burdens in such a fashion. . . . A defendant certainly is in no better position to rebut a presumption which totally excuses a plaintiff from meeting the causation element than a plaintiff is in establishing the causation element as part of the prima facie case.

Id. We've seen plaintiffs trot this tired argument out in favor of abandoning any and all legal rules that can preclude recovery. Thus, there are lots of cases that, like Riley, reject it in various contexts. Here’s one we happen to have lying around: Strict liability “policies, however, have not been, and cannot be, applied to remove all forms of restriction imposed upon plaintiffs’ proofs in products liability actions.” Duchess v. Langston Corp., 769 A.2d 1131, 1145 (Pa. 2001) (subsequent remedial measures admissible in strict liability).

In Harris, the court declined to create a heeding presumption in a case involving a truck accident. The court observed that its state supreme court had, in a prior warning causation case (one involving a prescription vaccine), held: “Assuming arguendo that the warning was inadequate, [the plaintiff] still had the burden of showing that an adequate warning would have altered [the doctor's] conduct.” 912 So.2d 1109 (quoting Wyeth Laboratories, Inc. v. Fortenberry, 530 So.2d 688, 691 (Miss.1988)). This causation standard, Harris held, precluded any heeding presumption:

The fact that our supreme court has ruled on cases where a heeding presumption could easily have been applied to aid the plaintiff in a products liability case and declined to do so indicates to us that the [court] has no intention or desire to adopt or create a heeding presumption as a part of our jurisprudence with respect to product liability cases. Therefore, we decline to create one as well.

Id.

DeJesus, in contrast, was more of a statutory case, involving causation language in the Connecticut product liability statute. The statute, however, was silent about what “proving’ causation entailed. The court held that it did not entail a heeding presumption:

[Plaintiff’s] argument is untenable. The plaintiff, the claimant herein, acknowledges that [the statute] specifically places upon him the burden of proving proximate cause, but then argues that the statute is vague by not providing guidelines as to how a claimant can satisfy this burden. . . . The language of the statute is clear. There was no presumption of proximate cause that arose on the jury’s finding that [defendant] had failed to provide adequate warnings.

548 A.2d at 744.

Beyond the cases cited in Rivera, there’s a lot of law, perhaps predictably, in New York and California.

In New York, “[u]nder well settled law, to prove proximate cause, a plaintiff has the obligation to adduce proof that had a warning been provided, she would have read the warning and heeded it.” Mulhall v. Hannafin, 841 N.Y.S.2d 282, 287 (N.Y.A.D. 2007). Accord Sosna v. American Home Products, 748 N.Y.S.2d 548, 549 (N.Y.A.D. 2002) (“in this State, it remains plaintiff’s burden to prove that defendant’s failure to warn was a proximate cause of his injury, and this burden includes adducing proof that the user of a product would have read and heeded a warning had one been given”); Topliff v. Wal-Mart Stores East LP, 2007 WL 911891, at *43 (N.D.N.Y. March 22, 2007) (no heeding presumption in New York; at most an “inference”); Smallwood v. Clairol, Inc., 2005 WL 425491, at *2 (S.D.N.Y. Feb. 18, 2005) (“plaintiff has the burden to establish “that he would have read and heeded a different warning had one been given”).

In California, all the law’s on the trial court level, but it holds that California would not recognize a heeding presumption. In Motus v. Pfizer Inc., after a lengthy discussion of California precedent, the court summed up:

Given that other no other court applying California law in this context has adopted the presumption, and several courts have failed to do so when the presumption could have been critical, this Court will not apply it here.

196 F. Supp.2d 984, 994-95 (C.D. Cal. 2001), aff’d, 358 F.3d 659 (9th Cir. 2004). Accord Nix v. SmithKline Beecham Corp., 2007 WL 2526402, at *2 (D. Ariz. Sept. 5, 2007) (“California. . .has not adopted a rebuttable presumption that the physician would have heeded an adequate warning”); Latiolais v. Merck & Co., 2007 WL 5861354, at *4 (C.D. Cal. Feb. 6, 2007) (plaintiff “improperly invokes the ‘rebuttable presumption’ doctrine. . ., as no California court had adopted it”), aff’d, 302 Fed. Appx. 756 (9th Cir. 2008); Lord v. Sigueiros, 2006 WL 1510408, at *4 (Cal. Super. April 26, 2006) (concluding that Motus “accurately summarize[s]” California law), aff’d, 2007 WL 4418019 (Cal. App. Dec. 19, 2007) (unpublished).

Elsewhere, courts have concluded that Alabama, Georgia, Minnesota, New Hampshire, South Carolina, and Wisconsin do not recognize the heeding presumption. See Gurley v. American Honda Motor Co., Inc., 505 So.2d 358, 361 (Ala. 1987) (warning cases “cannot be submitted to a jury unless there is some evidence that the allegedly inadequate warning would have been read and heeded and would have kept the accident from occurring”); Porter v. Eli Lilly & Co., 2008 WL 544739, at *11 (N.D. Ga. Feb. 25, 2008) (“there is no indication in Georgia law, however, that it would apply this comment in the manner of a ‘heeding presumption’ that would vitiate the need for a plaintiff to establish proximate cause for her injuries”), aff’d, 291 Fed. Appx. 963 (11th Cir. 2008); Tuttle v. Lorillard Tobacco Co., 377 F.3d 917, 925 (9th Cir. 2004) (“Minnesota state courts have not adopted the so-called ‘heeding presumption’”); Wilson v. Bradlees, Inc., 250 F.3d 10, 16 (1st Cir. 2001) (“New Hampshire has not adopted the 'read and heed' presumption, and we will not do so on its behalf”); Odom v. G.D. Searle & Co., 979 F.2d 1001, 1003 (4th Cir. 1992) (“There is no such presumption under South Carolina law, and we are unwilling to create one”); Kurer v. Parke, Davis & Co., 679 N.W.2d 867, 876 (Wis. App. 2004) (“[e]ven in the event that a warning is inadequate, proximate cause is not presumed”).

So, while there are quite a few states that adopted heeding presumptions – mostly during product liability law’s “free lunch” period in the 1970s and 1980s – there’s hope yet. Rivera demonstrates that, when an appellate court actually takes a hard look at the underpinnings of this spurious presumption, there’s a good chance that it will be rejected.

Device Preemption Win In Louisiana

2009-07-02T05:29:00.000-07:00

A tip of the cyberhat to blog reader Ed Fitzgerald at Gordon & Rees for sending us the latest preemption win in the post-Riegel device world. It's Bencomo v. Guidant Corp., slip op. (E.D. La. June 30, 2009). The case involves a PMA-approved stent. It's all about express warranty claims because the plaintiff abandoned everything else in the complaint and chose to hunker down with that single remaining claim.

That claim was based upon alleged discrepancies between the stent's Patient Guide (which the plaintiff claimed - only by omitting significant language - promised to "capture all emboli") and the device's labeling. Slip op. at 2.

Didn't work. Preemption applied to the express warranty claim for several reasons.

First of all, not only the labeling, but the patient guide as well, had been presented to the FDA and approved. Slip op. at 13 (there's a long discussion of Riegel on the intervening pages). Preemption precluded plaintiff from basing an express warranty claim on FDA-approved language. Id. at 14. Any alleged inconsistencies between the patient guide and the device labeling were "of no moment" because both documents had FDA approval, and plaintiff's claim was a state-law attempt to change one or the other:

The plaintiff raises the issue of an alleged discrepancy in an effort to prove that the Guide that he read was untrue. Even assuming arguendo that there are inconsistencies. . .the plaintiff's argument is of no moment. Both [documents] were approved by the FDA as a part of the premarket approval process. . . . The plaintiff argues that the inconsistency is important because it will enable him to prove that the statements he relied upon in the Guide were untrue. . . .[I]t is for the precise reason that the plaintiff must demonstrate untruthfulness under [state law] that the. . .breach of warranty claim. . .is preempted.

Id. at 15.

Then the court dealt with plaintiff's obligatory "parallel violation" argument. Slip op. at 16-17. That failed as well. Plaintiff claimed broadly "that FDA regulations require that all labeling of medical devices must accurately represent the device. . .consistently with the [labeling]." Id. at 16. On its face the court found that this claim "relate[s] to and [is] potentially inconsistent with" the FDA's approval of both documents. Id. at 17.

Congrats to Guidant and its counsel. Keep those wins coming.

An Avandia Removal Spat

2009-06-30T05:00:00.000-07:00

Egad -- yet another post on removal!

We'll try to keep it mercifully brief.

In In re Avandia Marketing, Sales Practices and Prods. Liab. Litig., [That caption about covers the waterfront, doesn't it?] MDL No. 1871, 2009 U.S. Dist. LEXIS 51558 (E.D. Pa. June 18, 2009), GlaxoSmithKline removed two "Avandia supposedly increases the risk of heart attack" cases from state court. GSK removed the Martinez case from a state court in New Mexico and the Brown case from North Carolina. Both were then transferred to the MDL in Philadelphia, and Judge Rufe ruled on plaintiffs' motions to remand.

In Martinez, the main question was whether the GSK detail representative, Carmen Hoss, was fraudulently joined on a product liability claim. Plaintiff alleged that GSK deceived the world about the supposed cardiac risks of Avandia. But plaintiff also pleaded that Hoss was aware of those cardiac risks and supposedly misrepresented them, so plaintiff could sue Hoss for the misrepresentation. 2009 U.S. Dist. LEXIS at *13-*14. GSK said that Hoss wasn't aware of any supposed cardiac risks of Avandia and so was fraudulently joined.

Think for a minute about plaintiff's alleged scam: GSK is supposedly trying to hide the risks of its drug from the world, but nonetheless tells its sales reps about those very risks?! Judge Rufe acknowledged that "GSK's argument [that there was no suggestion that the sales rep knew of the alleged risks] has some appeal -- it is difficult to imagine a scenario in which a drug company divulges otherwise secret information about the dangers of its products in training materials or educational sessions given to sales representatives." Id. at *17.

But New Mexico state law doesn't require specificity in pleading, and the general (and implausible) allegations of Hoss's knowledge of Avandia's risks "are potentially sufficient under New Mexico law." Id. at *20. The court thus remanded the Martinez case.

We have three reactions to that.

But we can't reveal the first reaction in polite company, so we'll keep it to ourselves.

Our other two reactions are legal, so we'll keep typing: First, this holding means that removal is easier in states with rules that require fact pleading (such as Pennsylvania) than in states that permit mere notice pleading (such as New Mexico). The additional details required in a fact pleading state will make it harder to support spurious claims. That's a curious result, but it's not necessarily wrong: State court rules govern pleadings in state courts, and those rules may affect removal issues.

Second, we assume that the Twombly/Iqbal pleading standards (which we've discussed here and here, among other places), which now apply in federal court, will over time be adopted in some state courts -- particularly state courts with rules of procedure modeled on the Federal Rules. Thus, over time, "implausible" state court complaints will no longer state claims, and defendants will have more opportunities to remove based on fraudulent joinder.

The other Avandia removal was in the Brown case. The question there was whether GSK's principal place of business was in North Carolina or Pennsylvania. (Brown was a citizen of North Carolina. If GSK's PPB was in North Carolina, then the parties would not be diverse, and the court would have to remand the case.) Applying the "center of activities" test, which the Third Circuit uses to determine a corporation's principal place of business, Judge Rufe found that, as of late 2008, GSK's principal place of business was in Pennsylvania. Diversity existed, and plaintiff's motion to remand Brown was denied. Id. at *29.

As to that holding, we note only that on June 8, the Supreme Court granted certiorari in Hertz v. Friend, No. 08-1107, which presents the question "[w]hether the location of a nationwide corporation’s headquarters can be considered for purposes of determining principal place of business for diversity jurisdiction citizenship under 28 U.S.C. § 1332." The cert petition (here's a link, courtesy of SCOTUS blog) notes that courts currently use four different tests to determine a corporation's principal place of business; the Third Circuit's "center of activities" test is just one of the four.

Thus, a decision in Hertz v. Friend (which the Supreme Court will presumably decide in late 2009 or early 2010) may provide guidance on the appropriate way to determine a corporation's principal place of business.

Another Severance Of Med Mal Claims To Preserve Diversity As To Products Defendants

2009-06-29T14:01:00.000-07:00

We posted earlier this month about Joseph v. Baxter, in which Judge James Carr (of the Northern District of Ohio) severed and remanded claims against the non-diverse health care providers to create diversity as to the drug company defendant.

We raised a few questions at the end of that post, asking, among other things, whether the holding was limited to situations where (1) the drug company removed before it was aware that health care providers had been named as defendants or (2) a federal multidistrict litigation proceeding was pending.

Judge Carr's back!

And we learned moments ago that the answer is "no" -- to both of our questions!

In Judge Carr's court, if a plaintiff sues both non-diverse health care providers (on medical malpractice claims) and an out-of-state drug company (on product liability claims), the federal court can sever and remand the med mal claims and retain jurisdiction over the then-diverse products claims.

That's the result in DeGidio v. Centocor, No. 3:09CV721, slip op. (N.D. Ohio June 29, 2009) (here's a link). Ohio citizen DeGidio sued non-resident drug companies -- Centocor, Johnson & Johnson, and Ortho-McNeil Pharmaceutical -- on product liability claims and, in the same complaint, sued Ohio resident health care providers -- Dr. Ray Miller and Nurse Jane Doe -- on medical malpractice claims related to DeGidio's ingestion of the drug Remicade.

The drug companies rolled all their strength up into one ball and removed the case to federal court. DeGidio moved to remand. The drug companies asserted that the health care providers were dispensable parties, so the federal court could sever the claims against the medical malpractice defendants and remand them to state court, creating diversity jurisdiction as to the product liability defendants.

That's exactly what Judge Carr did: He severed and remanded the claims against Dr. Miller and Nurse Doe, and then retained jurisdiction over the remaining, diverse product liability lawsuit.

At that point, the judge didn't have to address the drug companies' arguments that the health care providers had either been fraudulently joined (because plaintiff hadn't provided an affidavit of merit as to the med mal claims) or fraudulently misjoined (because the med mal and products claims couldn't properly be brought in a single case, under the logic of Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353, 1360 (11th Cir. 1996)).

If Judge Carr's logic catches on with other judges, we predict that you'll see an awful lot of drug companies removing cases on this ground and asking federal courts to sever and remand the med mal claims.

Wham, Bam; Thank You, Kamm!

2009-06-29T05:00:00.000-07:00

You know the "review of remand order" story, because we wrote about it earlier this month:

28 U.S.C. Sec. 1447(c) authorizes a federal trial court to remand a case to state court for either (1) lack of subject matter jurisdiction or (2) defects "other than lack of subject matter jurisdiction." Objections to subject matter jurisdiction can of course be raised at any time. But motions to remand "on the basis of any defect other than lack of subject matter jurisdiction must be made within 30 days after the filing of the notice of removal."

Section 1447(d) then says that a remand order "is not reviewable on appeal or otherwise." Courts have interpreted section 1447(d) to apply only to remand orders issued under section 1447(c). Thus, if a trial court remands a case on a ground not specified in 1447(c), the remand order may be reviewable.

We're simple guys, and our heads spin easily. We thus keep trying to simplify our world, so we can understand it and explain it to our clients.

We figure there are three kinds of motions to remand: (1) Motions to remand based on lack of subject matter jurisdiction (i.e., a lack of diversity or less than $75,000 in controversy, or the absence of a federal question), (2) motions to remand based on defects in the removal procedure (e.g., the defendant blew the deadline for removing the case or all defendants didn't join in the notice of removal), and (3) motions to remand that involve decisions on substantive questions of law apart from subject matter jurisdiction or the removal process (e.g., a motion to remand based on an abstention doctrine).

The first kind of motion to remand -- for lack of jurisdction -- can be made at any time. The second kind of motion -- for a defect in the removal process -- must be made within 30 days or is waived. The third kind of motion -- based on substantive law unrelated to jurisdiction or the removal process -- is not governed by section 1447 at all.

And -- take a deep breath -- the first two types of motions are not reviewable by appellate courts, but the third type may be.

Turns out this is exactly right.

But what a mess it is.

Kamm v. ITEX Corp., No. CV-06-00943-AJB, slip op. (9th Cir. June 15, 2009) (link here), involved a contract dispute. The contract contained a forum selection clause saying that any action for breach of contract would "be filed . . . in the courts of the State of Oregon." Id. at 7108. Kamm filed a complaint in state court. ITEX removed. Kamm moved to remand thirty-one days later. Id. The trial court granted the motion to remand, and ITEX appealed.

What result?

The facts seem so easy, but somehow it feels like we're in our first year of law school all over again.

The case turns on how the court categorizes a motion to remand based on a forum selection clause.

That kind of motion ain't jurisdictional. A forum selection clause does not deprive a federal court of subject matter jurisdiction. M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 12 (1972).

So is removal in violation of a forum selection clause a "defect other than lack of subject matter jurisdiction"? If it is, then Kamm had to move to remand within 30 days, which he had failed to do (and thus had waived his objection to removal). Also, if a forum-selection-motion-to-remand involves a "defect other than lack of subject matter jurisdiction," then that motion falls within section 1447(c) and the corresponding bar on appellate review contained in section 1447(d). If appellate review were barred, then the Ninth Circuit would have had to dismiss ITEX's appeal.

Judge William Fletcher spied all the issues and wrestled with this nicely.

He concluded that a motion to remand to enforce a forum selection clause does not involve a "defect" in the removal process, but rather involves an independent legal question. Id. at 7112-14. Thus, Kamm was not required to bring that motion to remand within 30 days, and the Ninth Circuit had jurisdiction to hear the appeal. The Ninth Circuit thus reached the merits and affirmed the trial court's remand order. Id. at 7115.

In one sense, we're happy: We generally root for defendants at this blog, but we'll get over that here. The Ninth Circuit reached a reasonable result, and the court grappled with this issue comprehensively.

In another sense, however, we're sad: As practicing lawyers, we have to live in this crazy, mixed up world, and we have to explain it to our clients, and we have to provide legal services at a fair price.

And here's the state of play: Whenever a plaintiff moves to remand on a non-jurisdictional ground, we must figure out whether the non-jurisdictional ground qualifies as a "defect" within the meaning of section 1447. If it does, then the plaintiff must move to remand within 30 days, and there will be no appellate review of a remand order. But, if the motion does not involve a "defect," then the motion need not be made within 30 days (although it must still be made "on a timely basis," id. at 7114), and appellate review will be available.

And remember: That's just in the Ninth Circuit!

Other circuits may classify "defects" differently or may solve this entire riddle in some other way.

And all of that is just to decide which court will hear your case! Only after we decide that can we start to worry about who should actually win on the merits.

We're not really here to cry on your shoulder.

But we will anyway.

Please don't blame us for the high cost of providing legal services. Sometimes it's the law itself that inflicts these things on us.

WSJ On Twombly and Iqbal

2009-06-27T08:20:00.000-07:00

Today's Wall Street Journal has an article advising the world that Ashcroft v. Iqbal was one of the most important cases for business in this year's Supreme Court Term.

Film at 11!

Here we criticized ourselves when we didn't publish a post about Iqbal until May 26, a full week after the decision had come down. (But we quickly recovered, joining the fray in the blogosphere here and here.)

Thank you, Wall Street Journal, for making us feel better about our original sluggishness.

Cost Of Litigation Drives Accutane Off The Market

2009-06-26T13:50:00.000-07:00

Bloomberg News reported this moments ago:

"Roche Holding AG, the world’s biggest maker of cancer drugs, is pulling its Accutane acne medicine from the U.S. market after juries awarded at least $33 million in damages to users who blamed the drug for bowel disease."

Here's our take: The cause of inflammatory bowel disease is unknown. There's essentially no scientific evidence linking Accutane to that condition. (Here's a link to our post from a couple of years ago reporting on the MDL judge's rejection of plaintiffs' general causation evidence supposedly linking Accutane to IBD.) Despite the absence of scientific evidence, juries have repeatedly awarded millions of dollars to folks who developed IBD after taking Accutane. (Here's a link to one example.) So Roche Holding is now giving up the ship.

If you ever need another example of the cost of litigation driving a beneficial drug off the market, add Accutane to your list.

UPDATE: Here's a link to the New Jersey Lawsuit Reform Alliance's statement on this subject, which resembles ours. A reader has also advised us that Accutane faces generic competition, which folks thinking about this situation should consider.

Scratch Three More Zyprexa Plaintiffs

2009-06-26T06:11:00.000-07:00

Judge Weinstein granted three more summary judgment motions yesterday in the Zyprexa mass tort. The reasoning is essentially the same for two of them - the statute of limitations ran, and there was no warning causation under the learned intermediary rule. The third case had no statute of limitations issue, and was solely a causation decision. Briefly:

In Morrison v. Eli Lilly, the drug helped the plaintiff with fewer adverse effects than any of the other medications he tried. There was evidence that the plaintiff refused to be taken off the drug despite weight gain. Plaintiff's medical records and his treater's deposition demonstrated knowledge of associations between the drug and weight gain/diabetes, well before the statute of limitations ran. Thus, under the Missouri discovery and learned intermediary rules, the claims were time barred. There was also no causation, as the physicians prescribed and maintained the plaintiff on the drug with knowledge of its potential effects because it was effective in treating the plaintiff's psychological condition.

In Leggett v. Eli Lilly, the plaintiff had been locked up as criminally insane, but the drug helped enough that he could be released. For almost twice the period of the relevant California statute of limitations, plaintiff's medical records and his treater's deposition demonstrated knowledge of associations between the drug and weight gain/diabetes. There was also no causation under the learned intermediary rule because the treater testified that he would prescribe the drug regardless of any diabetes warning because it helped the plaintiff so much.

In Neal v. Eli Lilly, use of the drug alleviated the plaintiff's various auditory hallucinations and suicidal depression. All four of the treating physicians were aware of the alleged diabetes association, and prescribed the drug anyway, given its beneficial effect on his condition. Because no additional warning would have changed the result, there was no causation under California law. There was no medical causation either, because the plaintiff's expert had been thrown out, and his treaters doubted that the drug caused plaintiff's diabetes.

Some Thoughts On Pleading And Proving FDA Actions

2009-06-25T11:29:00.000-07:00

This post is largely about drug and medical device litigation “inside baseball.” Some of it’s going to be really technical. So if you’re looking for philosophical musings, or just a chuckle or two over the latest bizarre goings on in our neck of the woods, come back later.

But if you’ve ever had to worry about pleading and proving FDA actions without formal discovery – especially doing it on Rule 12 motions to dismiss or motions for judgment on the pleadings – pull up a cyber chair.

The problem of getting what we know that the FDA did properly before a court on a motion that’s largely based upon the pleadings is something we’ve touched upon before. That post examined the use of judicial notice in Colacicco v. Apotex Inc., 521 F.3d 253 (3d Cir. 2008). Colacicco was (and we do mean "was", since the opinion was vacated on other grounds by the Supreme Court after Wyeth v. Levine) a drug preemption case.

One of the defendants in Colacicco (it was a consolidated appeal) had done something we consider to be rather risky – it raised a preemption issue via a motion to dismiss. We’ve always been hesitant about doing that because a motion to dismiss is limited to considering the complaint, and we think that preemption motions have a greater chance for success when they present a more detailed record of what the FDA actually did - as opposed to just what the plaintiff claims the FDA did.

Colacicco was important in that respect because the court employed judicial notice to bring an extensive FDA record before it on a motion to dismiss:

FDA rejection of several citizen’s petitions involving a different drug. 521 F.3d at 269.
FDA approval letters for the drug in question. Id. at 270 & n.16.
Certain FDA talk papers concerning either the drug in question or that class of drug. Id. at 270, 273.
An FDA Public Health Advisory, concerning the risk at issue and the class of drug. Id. at 270-71, 273.
The drug’s labeling. Id. at 273 n.18.
An FDA public notice concerning the risk at issue and the class of drug, that took place after the injuries in question. Id. at 273.
Revised classwide labeling, also post-dating the injuries in question. Id. at 273-74 & n.20.
An FDA news bulletin concerning the revised classwide labeling. Id. at 273-74.

Judicial notice in Colacicco offered a way around the record problems otherwise inherent in a pleadings-based motion. Basically, if the information is available on the FDA’s website (or presumably on other unimpeachable Internet sources), it’s subject to judicial notice under Colacicco.

Several things have happened since then. First, and most notably, Colacicco itself was vacated in the wake of Levine. That’s hardly fatal to the evidentiary points we discussed in our prior post, since the plaintiffs only appealed the preemption issue – and nothing having to do with judicial notice. That much is clear from the plaintiffs’ petition for certiorari and reply in support of that petition. Still, in light of the Colacicco GVR (grant, vacate, remand) order, it’s prudent to look for other cases that also involve judicial notice of FDA actions and related information.

Second, the Supreme Court decided Levine and raised the bar for implied preemption based upon FDA actions concerning prescription drugs. Given the various preemption criteria set out in Levine, we don’t expect to see many preemption motions brought in prescription drug cases before the summary judgment stage – which means after substantial discovery. The problem of getting evidence of FDA actions before the court is thus unlikely to arise very often in future prescription drug preemption motions.

Third, the Supreme Court’s decision in Riegel v. Medtronic, Inc., 128 S. Ct. 999 (2008), recognizing broad express preemption in cases involving PMA medical devices has had the opposite effect. With express preemption firmly established in PMA medical device cases, we expected, and have seen (see our post-Riegel device preemption scorecard for details), a lot more medical device preemption motions being made on Rule 12 motions.

Getting FDA information – including but not limited to the fact of PMA approval – properly before the court on such motions becomes critical. See Kavalir v. Medtronic, Inc., 2008 WL 4087950, at *4 (N.D. Ill. Aug. 27, 2008) (denying preemption motion without prejudice where “FDA internet pages” offered as evidence of PMA approval did not establish the “specific form” of approval that the “specific” product involved in the litigation had received). The most persuasive source for establishing PMA approval is, of course, the FDA itself.

Fourth, the Supreme Court has toughened up pleading standards under Fed. R. Civ. P. 8, first in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and more recently in Ashcroft v. Iqbal, 129 S. Ct. 1937 (U.S. 2009). We’ve been all over this issue, here, here, here, and here, from the moment Twombly was first decided two years ago.

While we’ve naturally concentrated on how the heightened standard affects plaintiffs, it’s possible that our side might have to – or, more likely, want to – plead more FDA-related allegations in support of our defenses. That would be another way to get around the problem that occurred in Kavalir, since under Fed. R. Civ. P. 10(c) “[a] copy of a written instrument that is an exhibit to a pleading is part of a pleading for all purposes.”

Fifth, there may be other reasons, having nothing to do with preemption, that we want to take judicial notice of a particular FDA action in a particular case.

Before we discuss cases, we wish to point out, as we have before, that to the extent the FDA action in question is formalized and published in the Federal Register, it is subject to mandatory judicial notice. Congress has said so. 44 U.S.C. §1507 (“[t]he contents of the Federal Register shall be judicially noticed”); Thuringer v. American National Red Cross, 2006 WL 406353, at *3 (N.D. Iowa Feb. 17, 2006) (“the plain language of §1507 states that judicial notice of the regulation is mandatory”). See McKenney v. Purepac Pharmaceutical Co., 83 Cal. Rptr.3d 810, 819 n.1 (Cal. App. 2008) (FDA’s views on preemption published in the Federal Register subject to judicial notice); Alpharma, Inc. v. Pennfield Oil Co., 2008 WL 1990783, at *9 (D. Neb. May 5, 2008) (FDA “rules” published in Federal Register “are judicially noticed”) (citing statute).

As far as cases, here’s what we’ve found. In Heisner v. Genzyme Corp., 2008 WL 2940811 (N.D. Ill. July 25, 2008), the court did exactly what we’ve been talking about – it took judicial notice of the defendant’s PMA approval in the context of a Riegel-based motion to dismiss:

Plaintiff argues against taking judicial notice of facts surrounding the FDA’s approval, stating that “disputable findings exist concerning the Defendant's compliance. . . .” However, this does not contradict the putative fact in question, which is only that the FDA approved [device] as a Class III device pursuant to the PMA process. . . . Neither of these [compliance-related] questions contradict the clear, undisputed, and publicly available fact put forward by Defendant; that the FDA approved [the device] as a Class III device. As a matter of law, this approval is granted only upon completion of the PMA process. Therefore, this Court takes judicial notice of the fact that [the device] is a Class III device approved by the FDA pursuant to the PMA process.

Id. at *1 (emphasis added). Heisner was followed, as to judicial notice, in Bausch v. Stryker Corp., 2008 WL 5157940, at *3 (N.D. Ill. Dec. 9, 2008). See Rivelli v. MH & W Corp., 890 A.2d 978, 982 (N.J. Super. A.D. 2006) (taking judicial notice of FDA drug approval).

Another important judicial notice case is In re Epogen & Aranesp Off-Label Marketing & Sales Practices Litigation, 590 F. Supp.2d 1282 (C.D. Cal. 2008). In Epogen/Aranesp the court had this to say about jurisdiction of drug labeling:

On a motion to dismiss, the Court may take judicial notice of facts that are not “subject to reasonable dispute.” Under Fed. R. Evid. 201, a fact is not subject to reasonable dispute when it is “capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” The Court grants [the] request as to . . . labels for [the drug] that are publicly available on the FDA website, finding that the labels are documents not subject to reasonable dispute.

Id. at 1286. The court (Judge Gutierrez) relied upon its prior decision in securities litigation involving the same drugs. In that earlier case, also on a motion to dismiss, the court granted judicial notice of drug labeling and an FDA public health advisory – both of which were were available on the FDA’s website. In re Amgen Inc. Securities Litigation, 544 F. Supp.2d 1009, 1023 (C.D. Cal. 2008). Labeling was also granted judicial notice in: Horne v. Novartis Pharmaceuticals Corp., 541 F. Supp.2d 768, 776-77 (W.D.N.C. 2008), and Ebel v. Eli Lilly & Co., 536 F.Supp.2d 767, 781 (S.D. Tex. 2008), aff’d, 2009 WL 837325 (5th Cir. March 30, 2009) (unpublished).

Judicial notice is routinely given to FDA guidance documents, which are also available on the FDA’s website. See Johnson v. Pozen, Inc., 2009 WL 426235, at *1-2 (M.D.N.C. Feb. 19, 2009); In re Nuvelo, Inc., Securities Litigation, 2008 WL 5114325, at *2 (N.D. Cal. Dec. 4, 2008); Construction Laborers Pension Trust of Greater St Louis v. Neurocrine Biosciences, Inc., 2008 WL 4370010, at *5 (S D Cal. Sept. 23, 2008); Construction Laborers Pension Trust of Greater St Louis v. Neurocrine Biosciences, Inc., 2008 WL 2053733, at *7 (S.D. Cal. May 13, 2008); In re Intrabiotics Pharmaceuticals, Inc. Securities Litigation, 2006 WL 708594, at *8 (N.D. Cal. Jan. 23, 2006); see McGuire v. Dendreon Corp., 2008 WL 1791381, at *4 (W.D. Wash. April 18, 2008) (taking judicial notice of “FDA regulatory protocols,” which we guess means guidance documents).

An FDA public health advisory received judicial notice in Horne, 541 F. Supp.2d at 776-77. The same is true of FDA press releases in Matthews v. Donald, 2007 WL 2593086, at *1-2 (N.D. Ga. Sept. 4, 2007), and Wright v. Henderson, 2007 WL 2484317, at *2 (N.D. Ga. Aug. 28, 2007), and of an FDA safety alert in Rozzelle v. Rossi, 2007 WL 2571935, at *6-7 (W.D. Pa. Aug. 31, 2007).

The filing of adverse event reports with the FDA was granted judicial notice in Rollins v. St. Jude Medical, 583 F. Supp.2d 790, 804-05 (W.D. La. 2008).

A chart of drug approval dates in a document posted on the FDA’s website received judicial notice in Dimmick v. United States, 2006 WL 3741911, at *6 n.1 (N.D. Cal. Dec. 15, 2006).

Unspecified “FDA letters” were granted judicial notice in Schering-Plough Healthcare Products, Inc. v. Schwarz Pharma, Inc., 547 F. Supp.2d 939, 945 n.1 (E.D. Wis. 2008), amended, 2009 WL 151573 (E.D. Wis. Jan. 22, 2009). Unspecified evidence that certain advertisements were submitted to the FDA received judicial notice in In re Bextra & Celebrex Marketing Sales Practices & Product Liability Litigation, 2006 WL 2374742, at *11 (N.D. Cal. Aug. 16, 2006).

FDA amicus briefs concerning preemption were judicially noticed in McKenney, 83 Cal. Rptr.3d at 819 n.1.

Finally, we’re not exactly sure what FDA documents were subject to judicial notice in In re Zyprexa Products Liability Litigation, 549 F. Supp.2d 496 (E.D.N.Y. 2008), but since Judge Weinstein literally “wrote the book” on evidence (including Fed. R. Evid. 201 governing judicial notice), we felt we should include it. The Zyprexa opinion first states generally that “[p]ublic documents issued by government agencies such as the Food and Drug Administration (“FDA”) may also be considered.” Id. at 501 (discussing judicial notice). Thirty pages later – following an extensive discussion of the history of the drug, the opinion concludes, “[t]o the extent that judicial notice was taken of any evidence, the court complied with” Rule 201. Id. at 530-31. See also Meyers v. Bayer AG, 735 N.W.2d 448, 332 n.1 (Wis. 2007) (blanket judicial notice of various FDA “public records”); Sykes v. Glaxo-SmithKline, 484 F. Supp.2d 289, 203 & n.4 (E.D. Pa. 2007) (same).

On a related topic, in Banks v. County of Allegheny, 568 F. Supp.2d 579, 596 & n.9 (W.D. Pa. 2008), the court took judicial notice that a particular drug was “a medically acceptable course of treatment, relying upon “strategies” for control of the disease in question that were available on the website of the Centers for Disease control.

One last thing that we found – not specifically FDA-related, but still of interest – is that there is recent precedent for taking judicial notice of the contents of published medical literature. See United States v. Pfizer, Inc., 2009 WL 1456582, at *10 (E.D.N.Y. May 22, 2009).

Beyond judicial notice, there’s a technical issue about getting proper links to FDA PMA approval data that's available on the FDA’s website. This has been a pain in the you-know-what because, while individual PMA approval information is available (if you know where on the FDA’s website to look), the weblinks aren’t stable. By that we mean the links generated by the search function on the FDA site expire in about a month or so.

Thus these FDA-generated PMA links aren’t very good to put in briefs supporting a dispositive motion, because by the time the briefing is finished, the links in the initial brief don’t work any more. Recently, however, we got this tip from Dave Gossett over at Mayer Brown on how to solve that problem.

Here’s what to do. The trick to creating FDA website addresses for PMAs that don’t go bad in a few weeks is not to use the link for the database search result that appears with the results of performing a search. Those expire. Instead, it’s necessary to find and use the URL for the actual search itself.

Don’t understand? Well, neither did we at first. So we’ll give you an example. We’ll use the ninety-ninth supplement to the nine hundred and ninety ninth PMA that the FDA received in 1999 (like the FDA would ever approve that many devices in one year). That way we won’t have to worry about numerical typos, at least.

We could do the links with actual PMA and PMA supplement numbers, but we don’t want to single out any particular device. So remember, that since we’re using made up numbers, the made-up links aren’t going to go anywhere.

From the FDA’s PMA search page (assuming this was an actual PMA, which it isn’t) the following link would bring up the approval data for PMA #P990999, Supplement S099:

http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfPMA/pma.cfm?start_search=1&PMANumber=P990999&SupplementNumber=S099

It’s just a matter of plugging in the PMA number and PMA supplement number for the device that’s of interest. These numbers, if not already known to counsel, will be available from the client once the identity of the particular device in question is established. It’s always been available, so we guess that this sort of track-back capability exists for all PMA-approved devices.

Whenever a different PMA number or PMA supplement number is desired, just change the numbers that appear after the “PMANumber” or “SupplementNumber” parts of the URL we just posted. Note that (most practitioners, of course, already know this) the first two numbers of the PMA number are for the year in question. If that number is less than a thousand, a “zero” is necessary right after the year. Ditto for any PMA supplement with a supplement number under one hundred. It’s necessary to include the proper number of zeros as place holders.

The same process should work to link to FDA approval information for any supplement to any PMA that’s on the FDA’s system. If only the original FDA-approved PMA is desired (no supplement), just replace the “SupplementNumber” portion of that search screen with the phrase “SupplementType=NONE”. That is,

http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfPMA/pma.cfm?start_search=1&PMANumber=P990999&SupplementType=NONE

will give you a link to the original PMA (no supplement) for the first example we used above. Also, on the search result for any PMA supplement, there’s a link directly to the approval data for the original PMA.

Now, it’s not always necessary to know the details of the device (or to bother the client for them) in order to get this information. The search functions on the FDA’s search page aren’t limited to PMA and PMA supplement numbers. It’s possible to search for devices in other ways – such as using the trade name for the device or the date that the PMA (or supplement) was approved. Once the necessary PMA and PMA supplement numbers are obtained, they can be plugged in as already described.

Since URLs in the form of:

http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfPMA/pma.cfm?start_search=1&PMANumber=P******&SupplementType=****

trigger the search function itself, they will automatically link to a newly created temporary file on the FDA website each time they are used. Thus they won’t expire like the URLs for the actual search results do. For that reason, this type of link stays active permanently and can be used in filing briefs that the court might not read for several months.

If you use FDA evidence as often as we do, this is good stuff to know.

Strike Three; You're Out!

2009-06-25T05:43:00.000-07:00

It only took five years and two reversals on appeal, see In re St. Jude Medical, Inc., 425 F.3d 1116, 1119-21 (8th Cir. 2005); In re St. Jude Medical, Inc., 522 F.3d 836 (8th Cir. 2008), but the class action allegations in the St. Jude/Silzone litigation are finally history. The trial court reluctantly ("on a blank slate" the court would have certified the class, yet again) struck those allegations the other day. Here's a copy of the opinion. In the wake of the latest reversal (which we discussed here), the plaintiffs had tried to substitute "omissions" for affirmative misrepresentations in their allegations, but even a class-action-friendly judge couldn't stomach that hair splitting.

We doubt the Eighth Circuit would permit a third Rule 23(f) interlocutory appeal.

The long-running St. Jude saga is an excellent example of why class-action tolling of the statute of limitations in mass tort cases is inequitable and should not be allowed, a subject we've discussed before (just click on our "tolling" label on the right hand side of the screen (scroll down) for those posts). There's no way in logic or law that dilatory plaintiffs suing over this device should be entitled to over five years of tolling based upon meritless allegations of a supposed nation-wide class based upon extraterritorial application (questionable in and of itself) of one state's consumer fraud statute.

The State Of The Big Firm Blogosphere

2009-06-24T07:26:00.000-07:00

Beck thinks only about drug and device law. Herrmann sometimes veers off-topic and thinks about blogging.

This morning's post, a frolic and detour about big firm blogging, is Herrmann's work alone.

We took a peek at Kevin O'Keefe's recent report on the State of the AmLaw 200 Blogosphere to see whether blogging is catching on at big firms. Kevin reports that 41 percent of the AmLaw 200 now have blogs, which is a 110 percent increase in the last two years. Those numbers speak for themselves.

We then thought about three other things.

First, we expected to see that many of the blogs that Kevin identifies had withered on the vine. It's remarkably easy to start blogging, and unspeakably difficult to stick with it. We figured that many of the blogs on the list would not have posted recently.

We were surprised. It looks as though many of the blogs are quite active. In our unscientific survey (we did not look at all 227 blogs), we stumbled across only a few blogs that had plainly died. The "Benefits Biz Blog" hasn't published a post since November 11, 2008; we'd say that one's toast. Similarly, the "Climate Change Law Blog" last posted on February 2, 2009; either those guys are on sabbatical or that one's done. Likewise for the "Daily Dose of IP," which last posted on April 30, 2009; we think the fat lady's singing there, too.

But, for the most part, the big firm bloggers seem to be blogging along.

We also noticed (again, completely unscientifically) that blogs published by lawyers at firms sponsoring multiple blogs seem to be more active than blogs published by lawyers who are writing alone. Our best guess is that the shame factor is at work here: "If those of us in the Labor Practice can post regularly to our blog, then you guys in the Securities Practice should be able to do the same."

We're big believers in shame at the Drug and Device Law Blog: Beck shames Herrmann, and Herrmann shames Beck; if shame were not such a potent force, we'd have abandoned this gig years ago.

We next compared the list of firms with blogs to the AmLaw 200 report on profitability. Of the ten firms with the highest profits per partner (we know, we know! everyone criticizes that metric, but the public is still fascinated by it) in the United States, only one has any connection to a blog. And that "connection" is pretty remote.

Kirkland & Ellis, alone among the top ten PPP firms, has a blogging lawyer. But the efforts of that lawyer -- whose work appears at the Sports Law Blog -- just barely count as a "big firm blog." It's true that the blog's founder is a K&E associate, but the blog is now written by five "contributors" -- most of whom appear to be law professors -- and more than a dozen "guest contributors," who generally have no connection with K&E. And, like our own blog, the Sports Law Blog is not "firm branded." It appears to be the product of the collection of folks who publish it, rather than an institutional effort by the firm.

The other top ten PPP firms -- Wachtell, Quinn Emanuel, Boies Schiller, Sullivan & Cromwell, Paul Weiss, Cravath, Simpson Thacher, Cleary, and Schulte Roth --have no apparent affiliation with any blogs at all.

Make of that what you will.

Finally, our last observation. We're still nuts: So far as we can tell, we're still the only two big firm bloggers who co-host a blog while working at firms that are head-to-head competitors.

We're not sure exactly what that proves. Maybe our approach to this blogging thing doesn't make any sense. Maybe some of our readers think that it's commendable that the two of us can play nicely in the sandbox. Or maybe we just like each other.

Aw, that can't be it.

Anyway, perhaps someone with more spare time than we have can look at the list of big firm blogs and draw more scientific conclusions than we have. The data's there for the mining; someone should take a look.

Going After Anyone In The Neighborhood (Adelmann-Chester v. Kent)

2009-06-23T05:00:00.000-07:00

Vitek manufactured and distributed Proplast dental implants, used to treat degeneration of the temporal mandibular joint in the jaw. The FDA recalled those implants in 1991. The whole world sued.

Vitek declared bankruptcy.

Dr. Charles Homsy was an officer, director, and shareholder of Vitek.

Homsy skipped the country.

DuPont manufactured a raw ingredient that Vitek used to manufacture the implants.

Courts held that DuPont was protected by the "bulk supplier doctrine," which is an absolute defense to failure-to-warn claims.

Who's a plaintiff to sue?

675 plaintiffs chose to join in a single lawsuit in Louisiana state court to sue, among other, Dr. John Kent, a dentist who was a professor at LSU School of Dentistry and who had served as a scientific advisor to Vitek as it developed the Proplast device.

That's the backstory of Adelmann-Chester v. John N. Kent, D.D.S., 2008-0770, 2009 La. App. LEXIS 1073 (La. App. 4 Cir. June 5, 2009), the case that we're thinking about today.

A bunch of plaintiffs settled their claims and other claims were dismissed as time-barred, leaving a mere 163 plaintiffs when Kent moved for summary judgment. The trial court granted that motion, and the court of appeals affirmed.

Kent had a fair number of dealings with Vitek. He helped to design the implant and obtained patents in that regard. He received a royalty payment when Vitek sold certain products. He acted as a consultant to Vitek and owned some of the corporation's stock. But Kent never participated in fabricating or selling the implants. Id. at *3.

On that record, claims against Kent couldn't survive. Negligence claims didn't work because Kent owed no duty to patients implanted (by other dentists) with the Proplast device. Id. at *20.

Strict product liability claims couldn't work because Kent was not a "manufacturer'"or "professional vendor" of the implants. Id. at *34. (Along the way, the Adelmann-Chester court cited Reeves v. AcroMed Corp., 103 F.3d 442 (5th Cir. 1997), for the proposition that the inventor of a medical device cannot be liable under a product liability theory as a manufacturer or supplier of the product. One of us worked mighty hard to achieve that result in Reeves way back when, so we're delighted to see that the precedent is making a lasting impact.)

People other than "manufacturers" or "vendors" can be liable for failure to warn only if they fail to pass on to product users an adequate warning that the manufacturer provided. Since plaintiffs offered no evidence of any warning provided with the Proplast device, Kent couldn't be liable for failing to pass that warning along. Id. at *36.

The court also noted that, although there may have been negligence in the production of the Proplast device, there was no evidence that Dr. Kent personally had been negligent in the particular activities that he performed. Id. at *33-*34.

Those holdings undercut each of plaintiffs' legal theories, so the appellate court chose not to address assorted other alleged errors identified by plaintifs on appeal.

We're pleased to see the Louisiana Court of Appeal hold the line in this case. When a primary defendant isn't around to pay claims, and a bunch of plaintiffs are claiming injury, it's easy for courts to ignore the law and look for anyone in the neighborhood to hold liable. (Think about the tertiary asbestos defendants, for example.)

But defendants have rights, too. A scientist (or dentist, or physician) can properly choose to perform specific roles for a medical device company -- helping to design a product and giving scientific advice -- and to invest in the company -- presumably because the scientist thought the company was selling a good product -- without agreeing to manufacture or sell the product. If the scientist breaches a duty in the role that he or she agreed to undertake, then the scientist can properly be held liable.

But the scientist shouldn't be held liable to the entire world, after the fact, simply out of a perceived need to hold someone -- anyone! -- liable to pay damages to allegedly injured plaintiffs. That result would upset the parties' appropriate expectations when they originally entered their arrangements, and would cause many scientists to refuse to work with medical device companies, which would surely work to society's collective detriment.

Daubert In A Med Mal Context

2009-06-22T05:00:00.000-07:00

A couple of issues in Svindland v. The Nemours Hospital, 2009 U.S. Dist. LEXIS 43315, No. 05-417 & 05-441 (E.D. Pa. May 19, 2009), caught our eye -- namely: (1) whether to exclude comparative risk evidence and (2) whether to allow plaintiffs to discover the raw clinical data that formed the basis of published medical articles.

Svindland involved two medical malpractice cases brought by the parents of infants who died after heart surgery performed by Dr. Norwood. Plaintiffs claimed that Dr. Norwood did not cool the infants pre-operatively (don't ask!) for long enough to protect the infants' organs and that the informed consent process for the surgery was inadequate.

The cases have a long procedural histroy, with which we won't bore you.

Ultimately, plaintiffs wanted to introduce expert testimony comparing mortality data from other hospitals to show that Dr. Norwood's mortality rates were unusually high. That's of interest because we've seen plaintiffs make similar attempts to compare different drugs having the same indication. In Svindland, the court rejected this testimony under Daubert.

The first data set was based on ICD-9 billing codes (for insurance reimbursement), rather than IPCCC treatment codes. The billing codes can be misclassified or fail to describe accurately the specific nature of the surgery being performed. Id. at *15. The other data set did not contain information about patient co-morbidities and reported only 30-day survival rates. Id. at *16-*17. And, even if the underlying data were sufficient, plaintiffs' expert intended to use the RACHS-1 method of comparing the surgical data, and that method "was designed to compare the whole body of work of a given program to a national standard for each classification group. It was not meant to compare one surgery to another surgery, or to look at the performance of an individual surgeon for a particular operation." Id. at *18-*19. The court thus excluded the expert testimony.

Plaintiffs also wanted to introduce and compare "evidence of morbidity and mortality by introducing isolated pages of medical records of other patients who had poor outcomes or who died following pediatric open-heart surgery." Id. at *19. In other words, plaintiffs wanted to create their own anecdotal case studies. The Court found that evidence to be both irrelevant and, if relevant, more prejudicial than probative. "Even if mortality rates might seem relevant to the plaintiffs' informed consent claims, the plaintiffs have not persuaded the Court that the mortality data that they would seek to introduce have taken into account co-morbidities or have otherwise been risk-adjusted so as to be relevant to the surgeries at issue." Id. at *22.

The second issue is trickier, but no less interesting. Plaintiffs served subpoenas "to obtain the raw data underlying publications of studies done" at a hospital where Dr. Norwood had previously worked, and which included data about some of Norwood's earlier surgeries, "to allow their expert to independently evaluate the data and offer an opinion on whether the cooling technique at issue increased the risk of adverse surgical outcomes." Id. at *24.

This is a delicate issue for practicing lawyers (such as the two of us) to discuss in public, because our clients' needs vary with the situation. If the published studies support our clients' position, then we may well resist any effort by our opponents to obtain and reanalyze the underlying raw data. On the other hand, if the published studies do not support our clients' position, then we may seek to compel disclosure of that data to permit our experts to review and reanalyze it. For a less biased (and more scholarly) approach to this issue, you might look at Bill Childs' article about discovery into the peer review process, The Overlapping Magisteria of Law And Science: When Litigation and Science Collide, 85 Neb. L. Rev. 643 (2007).

To avoid having our own words quoted back at us some day, we take no position on the propriety of subpoenaing raw data underlying a published study. Instead, we'll just report on the court's holding.

In Svindland, the court held that the hospital did not have to disclose data underlying the published studies. The court chose not to address the public policy issues, such as whether permitting litigation-related discovery into the raw data underlying scientific research would chill medical research.

Instead, the court ruled on narrower grounds: "The data are not relevant to show what Dr. Norwood knew when he operated on Ian Svindland or Michael Daddio. Nor will they prove the applicable standard of care [at the times of the surgeries]. They also will not shed further light on the issues of proximate and but-for causation." Id. at *30. The court also thought the data might unduly confuse the jury, so the court denied plaintiffs' motion to compel and granted the defendants' motion for a protective order.

If you're ever on that side of the issue, you might put Svindland to use.