Monday, December 31, 2007
Posting the best and worst product liability decisions of 2007 isn't enough.
How about the best pharmaceutical stories -- legal or non-legal -- of the year?
But we're not pulling on the laboring oar for this one; we're just searching the web.
Over at Pharma's Market on CNBC.com, Mike Huckman thinks about financial issues. His list of the top stories of the year include Avandia, Dendreon, and stents, all of which are well-known to product liability lawyers.
Pharm Aid nominates it own top ten, including the FDA's decision to crack down on over-the-counter cold and cough medicines, the Vioxx settlement, and the slowing pace of drug approvals.
NurseZone.com includes in its "top ten health policy stories of the year" the emergence of health care as a leading issue in the presidentail campaign, the lack of health insurance for tens of millions of Americans, and gaps in prescription health coverage for seniors.
Finally, the World of DTC Marketing predicts that 2008 will see major stories about the side effects of drugs or data allegedly hidden by pharmaceutical companies. (Forgive our cynicism, but we would add to those bold predictions a couple of our own: (1) a major Hollywood star will disclose a substance abuse problem, and (2) the campaign for the American presidency will turn negative at some point.)
That's it for '07.
Have a happy and healthy new year!
Sunday, December 30, 2007
You know what's odd? Arbino is plainly an important case: It's the most recent in a series of decisions in state courts ruling on the constitutionality of various types of tort reform, and it comes out of Ohio, the country's seventh most populous state. Despite the decision's importance, almost no one will read this puppy.
Litigators don't care about the reasoning of this case. There's only one thing that matters to a working lawyer: Did the court uphold the tort reform provisions (so I must live in this new environment) or did the court strike them down (so I can forget about 'em)? The court's justification for holding as it did -- constitutional issues that concern only deep thinkers and academics -- simply don't matter.
For you folks -- the working lawyers -- here's the skinny: The Ohio Supreme Court upheld two aspects of tort reform against facial constitutional challenge. First, in general, Ohio Revised Code Sec. 2315.18 now limits noneconomic damages to the greater of $250,000 or three times economic damages up to a maximum of $350,000. Those limits do not apply, however, if the plaintiff suffered one of various types of severe physical injury.
Second, Ohio Revised Code Sec. 2315.21 now generally limits punitive damages in tort actions to two times the total amount of compensatory damages awarded to a plaintiff per defendant. Those limits, however, do not apply if the defendant was convicted of one of several types of felonies. Lower limits apply if the defendant is a small employer or individual. And punitive damages may not be awarded more than once against the same defendant for the same course of conduct once the maximum amount of damages has been reached, unless the plaintiff offers substantial new evidence of improper conduct by the defendant.
That's it. Litigators now know the essence of Arbino, and they know when they'll have to consult the new statutes to see how they apply in particular cases.
Unlike typical practicing lawyers, a few scholars will care deeply about the issues decided in Arbino. But any little summary of the case that we publish can't possible satisfy them. Scholars will, of necessity, have to parse the decision itself.
Folks who litigate tort reform issues will also care about Arbino. For them, this will be an important precedent.
The rest of the world will never read the decision and will know only that it ignited a firestorm, with liberals complaining that the Ohio Supreme Court has been bought and paid for by business, and conservatives exulting that a court finally exercised appropriate judicial restraint, deferring to policy choices enacted by the legislature and providing some predictability to damage awards in tort cases. For examples of the outraged left, read the Daily Kos; for the business perspective, see the reaction of the National Federation of Independent Business.
For the moderately curious, however, here's our quick trot through the decision.
First, the backstory: The Ohio legislature was Republican and the Supreme Court Democractic in the 1990s. The legislature repeatedly passed, and the Supreme Court repeatedly struck down, various attempts at tort reform.
This led to unbelievably ugly judicial elections in Ohio in the early 2000s. As of today, the Ohio legislature remains Republican, and the Ohio Supreme Court is now unanimously Republican. The legislature thus took another shot at tort reform; this time, it worked.
Chief Justice Moyer wrote the majority decision in Arbino, joined by Justices Lundberg Stratton, O'Connor, and Lanziger. Justice Cupp concurred separately, providing a fifth vote in favor of upholding all of the tort reform provisions. Justice O'Donnell dissented in part; he would have struck down the cap on noneconomic damages. And Justice Pfeifer dissented from the whole enchilada. (Ohio court watchers know that Justice Pfeifer runs as a Republican, but he consistently voted with the Democratic majority on the court in the 1990s, and he typically dissents when today's Republican majority rules in favor of business. Outraged conservatives fume that the Ohio Supreme Court consists of seven Republicans, but only six conservatives; delighted liberals are pleased to have one voice on the court that articulates their views without regard to party affiliation.)
What were the facts? Melisa Arbino filed a product liability case against Johnson & Johnson and others claiming that she suffered blood clots and other injuries as a result of having used the Ortho Evra Birth Control Patch, a hormonal birth-control medication.
In the Arbino decision, the majority first fought its way through a thicket of Ohio Supreme Court precedents from the 1990s repeatedly striking down as unconstitutional previous efforts at tort reform. The court ultimately found that the legislature "made progress in tailoring its legislation to address the constitutional defects identified by the various majorities of this court. The statutes before us here are sufficiently different from the previous enactments so as to avoid the blanket application of stare decisis." Slip op. at 8.
The court then upheld the limit on noneconomic damages against a series of facial constitutional challenges. The law did not violate the constitutional right to jury trial because it allowed juries to decide underlying facts and then required only that courts apply legal limits to damages based on those facts. The majority analogized to courts imposing remittitur on jury verdicts or to statutes that authorize trebling damages, which is the opposite of limiting them.
The cap does not violate the "open courts" and "right to remedy" provisions because it does not "wholly deny persons a remedy for their injuries." Id. at 14. The cap complies with due process because the law was related to the general welfare of the public and not arbitrary or unreasonable. (The change in the Ohio Supreme Court's political make-up is perhaps most visible here, where the majority says that one of its previous precedents, Sheward, contains an "abundance of dicta" suggesting that damage caps may violate due process, but goes on to uphold the new cap because the holding of Sheward -- a 1999 case -- was limited to other issues.)
The cap does not violate equal protection because it is facially neutral and bears a rational relationship to a legitimate government purpose. And the cap also survives challenges based on separation of powers and the single subject rule. Id. at 22-24.
One down; two to go.
The court declined to address the constitutionality of a tort reform provision dealing with the collateral sourse rule because Arbino lacked standing to challenge that provision. Id. at 25-26.
Two down; one to go.
Finally, the court upheld the cap on punitive damages against the same collection of constitutional challenges aimed at the noneconomic damages cap. The court again read Sheward narrowly and declined to follow its dictum that suggested that a cap on punitive damages would violate the Ohio Constitution's right to a trial by jury. Id. at 27-33. (At this point, the gloves are off. A Democratic court would likely have said that Sheward's dictum was recent and directly on point, meriting deference. A Republican court instead finds the words to be mere dictum, not worthy of respect and rendered questionable by recent U.S. Supreme Court cases interpreting not the Ohio Constitution, but the U.S. Constituion.) (Mein Gott, Bexis, what are you doing? Implicitly criticizing a pro-business result that benefits our clients?) (Cut that out, Herrmann. You know full well that I didn't write that parenthetical; you did.) (Did not.) (Did too.)
Justice Pfeifer's dissent criticizes the majority on every score. But what we found most noteworthy was the tone of Pfeifer's dissent. At page 50, we learn that the majority employed "shallow reasoning and shoddy logic." At page 51, the majority's arguments are "insubstantial, legally unsupported, and in many cases disingenuous." At page 53, "superficial or disingenuous." And so on. Whatever our politics, can't we agree that the public discourse of our justices should be a little more civil?
More substantively, Pfeifer criticizes certain studies that the General Assembly relied upon in legislating because the studies were not "peer-reviewed" or "published in a scholarly journal." Slip op. at 62. Whatever you think of the rest of the dissent, let's hope this concept never gains traction. Legislatures are given wide range to pass laws based on their perceptions of public policy. If courts start to impose Daubert review on acts of Congress, today's partisan battles will look like mere skirmishes in the wars that would come.
Let's hope that the battles of 2008 don't degenerate into that.
Friday, December 28, 2007
The quiet period between Christmas and New Year’s Day seems like the perfect time to think about everybody’s favorite toxic tort topic: the use of epidemiologic relative risks as a substantive legal threshold. [NB: “epidemiologic,” not “epidemiological”] Of course, because the horde of corporate counsel, outside defense counsel, and justice lawyers (f/k/a trial lawyers (f/k/a plaintiffs’ lawyers)) who slavishly follow this site are probably away from the office, this post may be the blog equivalent of one hand clapping. (Cue: sound effect). With that in mind, this pedantic little nugget will be short and sweet and will assume a certain familiarity with principles of epidemiology and standards causation.
The take-home point here is that the fabled doctrine of 2.0 applies to proof of specific causation (did the particular plaintiff’s actual exposure cause the plaintiff’s alleged injury?) and not to proof of general causation (is the substance at issue at the dose alleged by plaintiffs capable of causing the particular injury?). See In re Silicone Gel Breast Implants Prod. Liab. Litig., 318 F. Supp. 2d 879, 893 (C.D. Cal. 2004) (“In re SBIs”) (the “‘doubling of the risk” requirement applies to statistical evidence proffered to prove specific, not general causation”). Getting this right matters because, when defendants erroneously urge 2.0 in the general causation context, they risk embarrassment, see id. (characterizing defendant’s general causation 2.0 argument as “based on a misunderstanding of relative risk, a mis-reading of Ninth Circuit precedent and a lapse in basic logical reasoning”), or worse, the loss of hard-won victories and years of work. See In re Hanford Nuclear Reservation Litig., 292 F.3d 1124 (reversing 762-page district court order granting defendants’ motion for summary judgment).
Characterizing 2.0 as an individualized causation doctrine may at first blush seem unscientific –and it actually is. The Federal Judicial Center's Reference Manual on Scientific Evidence states quite clearly that “[e]pidemiology is concerned with the incidence of disease in population and does not address the question of the cause of an individual’s disease." Reference Manual (2000) at 381 (citing inter alia, DeLuca v. Merrell Dow Pharms., 911 F.2d 941, 945 and n.6). But, as the Manual goes on to explain, “a number of courts have confronted the legal question of what is acceptable proof of specific causation and the role that epidemiologic evidence plays in answering that question.” Id. at 382. The Manual contains several pages on the 2.0 doctrine, with the caveat that that discussion “should be understood as an explanation of judicial opinions, not as epidemiology.” Id.
The 2.0 doctrine is thus not a matter of science, but a judicially created legal fiction that permits plaintiffs to attempt to prove specific causation when the lack of direct proof (because of the limits of scientific knowledge) makes proving causation impossible as a practical matter. Rather than toss plaintiffs out of court in the many cases involving injuries for which science cannot tell the precise cause (e.g., cancer, heart attack, birth defects), courts have permitted, as a matter of policy, proof of specific causation based on statistical inference. Still the best explanation of this legal doctrine comes from the Texas Supreme Court in Merrell Dow Pharms., Inc., 953 S.W.2d 706 (Tex. 1997), which I recommend reading in full to anyone who wants to understand this subject better. In summary, the Havner court explained the underpinnings of the doctrine:
In the absence of direct, scientifically reliable proof of causation, claimants
may attempt to demonstrate that exposure to the substance at issue increases the
risk of their particular injury. The finder of fact is asked to
infer that because the risk is demonstrably greater in the general population
due to exposure to the substance, the claimant's injury was more likely than not
caused by that substance. Such a theory concedes that science cannot
tell us what caused a particular plaintiff's injury. It is based on
a policy determination that when the incidence of a disease or injury is
sufficiently elevated due to exposure to a substance, someone who was exposed to
that substance and exhibits the disease or injury can raise a fact question on
Id. at 715 (citing Daubert v. Merrell Dow Pharms., Inc., 43 F.3d 1311, 1320 n. 13 (9th Cir. 1995) (“Daubert II”)). Thus, using epidemiology to prove individual causation (1) assumes that there is no direct proof of specific causation; (2) is a policy decision; and (3) relies on a logical inference.
The logical inference to be drawn from the number 2.0 arises from the more-likely-than-not standard of proof in civil cases. When an epidemiologic relative risk reaches 2.0, the agent is associated with an equal number of cases of disease as all other background causes. So the 2.0 legal fiction goes something like this:
Plaintiffs have the burden of proving specific causation under the more likely than not standard;
More likely than not implies greater than 50% probability;
An epidemiologic relative risk of 2.0 implies a 50% probability that the agent at issue was responsible for a particular individual’s disease;
Thus, a relative risk that is greater than 2.0 may permit the conclusion that the agent was more likely than not responsible for a particular individual’s disease.
See In re SBIs, 318 F. Supp. 2d at 893 (giving simple numerical examples to explain why the inference is logical).
It is important to remember, though, that a relative risk of more than 2.0 is not a “litmus test” and that a single epidemiologic study should not be considered legally sufficient evidence of causation; instead “[o]ther factors must be considered.” Havner, 953 S.W.2d at 718. Those factors include the Bradford-Hill criteria (which are beyond the scope of this allegedly short blog post), examining the design and execution of the studies relied on, and a showing that the individual plaintiff is similar to the those in the epidemiologic studies relied on such that the study results can be applied to the particular plaintiff. Id. at 718-20; see also In re SBIs, 318 F. Supp. 2d at 894. The context for such further analyses is usually the pretrial admissibility review for expert testimony under Federal Rule of Evidence 702 and state law equivalents.
The last point that I want to make is that the Ninth Circuit got this topic exactly right early on in Daubert II (which I also recommend reading in full for an intuitive explanation of the doctrine), but got it very wrong in In re Hanford, which I admit is a bit of a personal pet peeve. In Hanford, the district court bifurcated discovery to address first the general causation question of whether ionizing radiation at the levels to which plaintiffs were exposed were capable of causing the cancers and other injuries alleged. The district court got confused, however, and applied a 2.0 requirement at the general causation stage, granting summary judgment against any plaintiff who could not show that he or she had been exposed to a “doubling dose,” i.e., a dose of radiation that epidemiology showed more than doubled the risk of contracting that particular cancer.
On appeal, the Ninth Circuit correctly reversed the summary judgments on procedural grounds that the district court had violated its own discovery plan and had given plaintiffs inadequate notice of what they would have to prove in the ostensible general causation phase. In re Hanford, 292 F.3d at 1134. The Court should have stopped there.
It went on in dictum, however, to make a terrible 2.0 mistake as it attempted to distinguish Judge Kozinski’s correct treatment of 2.0 in Daubert II. The In re Hanford court stated, “It is critical to stress that the plaintiffs in Daubert II had no scientific evidence that Bendectin was capable of causing birth defects (generic causation), and therefore were required to produce epidemiological studies to prove that Bendectin more likely than not caused their own particularized injuries (individual causation).” Id. at 1136-37. Knowing what we now know about 2.0, we can see that that is an entirely nonsensical statement. If there is no scientific evidence of general causation, then there certainly wouldn’t be epidemiologic results showing a greater than 2.0 relative risk. Courts have repeatedly held in the Daubert context that without reliable proof of general causation, the inquiry never gets to specific causation. See, e.g., Kelley v. American Heyer-Schulte Corp., 957 F. Supp. 873 (W.D. Tex. 1997) (excluding specific causation testimony “[i]n the absence of any evidence regarding general causation”); Hall v. Baxter Healthcare Corp., 947 F. Supp. 1387, 1413 (D. Or. 1996)(specific causation proof “assumes that general causation has been proven”). Thus, the Hanford’s court statements on 2.0 should be viewed as mistaken dictum. All that was necessary to say was that the legal fiction of 2.0 should have played no role in the general causation phase.
We hope that makes your new year happy.
Thursday, December 27, 2007
Here's a link to the opinion.
We may post more, but we make no promises. It is, after all, a holiday week.
[Update: Bill Childs has a short description of the case at the Torts Prof blog here.]
Today, it's the other side of the coin: Our choices for the best ten decisions of the year.
May we have the envelope, please:
1. International Union of Operating Engineers Local No. 68 Welfare Fund v. Merck & Co., 929 A.2d 1076 (N.J. 2007). Number one on our list is this definitive decision by the New Jersey Supreme Court decertifying a nationwide class action of third-party payers under the New Jersey consumer fraud statute. That’s a huge win, no matter how it’s reasoned, because a potential billion-dollar lawsuit went up in smoke. But it’s the rationale that puts Operating Engineers firmly in the top spot. First, Consumer Fraud Act claims lack predominance because “ascertainable loss” individualizes the inquiry much like reliance does in the context of common-law fraud. Second, “price inflation” is a form of fraud on the market that doesn't apply to the CFA. Third, because third-party payers are large entities, a class action isn’t “superior” under the rules. Our earlier post is here.
2. Pennsylvania Employees Benefit Trust Fund v. Zeneca, Inc., 499 F.3d 239 (3d Cir. 2007). Just what the doctor ordered. With Colacicco pending in the same court, the Third Circuit finds broad implied conflict preemption (almost field preemption) of state law tort claims in a false advertising context. Implied preemption’s first win in a federal court of appeals could not have come at a better time or place. Our post is here.
3. Arons v. Jutkowitz, __ N.E.2d __, 2007 WL 4163865 (N.Y. Nov. 27, 2007). Okay, so it’s not technically a product liability case, but it has huge product liability implications. Reversing an adverse decision, New York’s highest court ruled that defense attorneys have equal rights to talk informally with physicians who treat personal injury plaintiffs. The court rejects the claim that there’s any HIPAA preemption in the litigation context. Our post is here.
4. Rowe v. Hoffman-La Roche, Inc., 917 A.2d 767 (N.J. 2007). The New Jersey Supreme Court strikes again. The court holds that the law of the state of injury, rather than the law of the state of the defendant’s incorporation (which was New Jersey) governs, in a prescription drug product liability case. That’s generally good because New Jersey substantive law is pretty liberal (the unique DTC exception to the learned intermediary rule, for one thing, and the heeding presumption for another), but it’s even better because plaintiff-specific choice of law typically defeats certification of putative multistate class actions. Our post here.
5. In re Bextra and Celebrex Marketing Sales Practices and Product Liability Litigation, ___ F. Supp. 2d ___, 2007 WL 4170276 (N.D. Cal. Nov. 19, 2007). Probably the best Daubert decision of the year, holding large chunks of the plaintiffs’ expert testimony to be inadmissible. Especially good on requiring epidemiology to prove “general causation” (can a drug cause a particular condition at all at a given dose?), downward extrapolation (just because something happens at a high dose, does it necessarily happen at a lower dose?) and requiring a relative risk of 2 or more (statistically, that’s how the “more likely than not” civil standard of liability is expressed). Our post is here.
6. Blunt v. Medtronic, Inc., 738 N.W.2d 143 (Wis. App. 2007). An excellent finding of broad express preemption where the FDA had specifically determined that a Class III medical device was safe and effective. It makes the list over several other similar decisions because it’s a state appellate court in a difficult jurisdiction for defendants. This decision is subject to further appeal. Our post is here.
7. Sykes v. Glaxo-SmithKline, 484 F. Supp. 2d 289 (E.D. Pa. 2007). The best pro-preemption decision on implied conflict preemption and the FDA Final Rule decided by a trial court in 2007. This lengthy decision is, somewhat surprisingly, decided under the Vaccine Act. It beats out several other similar decisions due to its comprehensive reasoning and detailed discussion of the Preemption Preamble to the 2006 Final Rule. Our post here.
8. Thomson v. Novartis Pharmaceuticals Corp., 2007 WL 1521138 (D.N.J. May 22, 2007). Whether it’s a harbinger or an aberration is too early to tell, but this federal district court decision that diverse cases brought in the defendant’s home state court are removable to federal court if removal is accomplished before service of process predictably (hey -- we predicted it, so it didn't take Jeanne Dixon or The Amazing Kreskin to view this crystal ball) prompted a horde of copycat removals. For 2008, we foresee a great deal more litigation on the point. Our posts here, here, here, and here.
9. In re Baycol Products Liability Litigation, 495 F. Supp.2d 977 (D. Minn. 2007). An excellent opinion on evidence. It excludes evidence of comparative safety between drugs of the same class, fraud on the FDA (due to Buckman preemption), corporate ethics, and regulatory actions outside of the United States. Our post here.
10. Prohias v. Pfizer, Inc., 490 F. Supp. 2d 1228 (S.D. Fla. 2007), and Prohias v. Pfizer, Inc., 485 F. Supp. 2d 1329 (S.D. Fla. 2007). Two decisions in the same case. Excellent on preemption, but even more important for their use of safe harbor provisions in state consumer fraud laws to dismiss claims against prescription drugs whose labeling and advertising was approved by the FDA. Our post here.
Honorable Mentions: (11) Bruesewitz v. Wyeth, Inc., 508 F. Supp. 2d 430 (E.D. Pa. 2007) (rejecting Ferrari anti-preemption rationale in Vaccine Act case); (12) Rohde v. Smiths Medical, 165 P.3d 433 (Wyo. 2007) (less than two months after Karl (the West Virginia case that was number one on our "ten worst" list yesterday), Wyoming adopts the learned intermediary rule); (13) O’Neill v. Novartis Consumer Health Inc., 55 Cal. Rptr.3d 551 (App. 2007) (relevance of FDA compliance in strict liability); (14) In re Neurontin Marketing & Sale Practices Litigation, 244 F.R.D. 89 (D. Mass. 2007) (denying class certification in an economic loss case involving off-label); (15) Ledbetter v. Merck & Co., 2007 WL 1181991 (Tex. Dist. Apr. 20, 2007) (Vioxx; fraud on the FDA preemption); (16) Beale v. Biomet, Inc., 492 F. Supp. 2d 1360 (S.D. Fla. 2007) (learned intermediary rule applies to consumer fraud claims); (17) Tucker v. SmithKline Beecham Corp., 2007 WL 2726259 (S.D. Ind. Sept. 19, 2007) (SSRI conflict preemption); (18) Nelson v. Wyeth, 2007 WL 4261046 (C.P. Philadelphia Co. Dec. 5, 2007) (HRT; warning causation); (19) Rattay v. Medtronic, Inc., 482 F. Supp. 2d 746 (N.D.W. Va. 2007) (PMA medical device preemption in circuit where law not settled); and (20) Jensen v. Bayer AG, 862 N.E.2d 1091 (Ill. App. 2007) (affirming denial of class certification in recall-economic loss case).
We never would have guessed it, but we must be optimistic guys: We had only ten choices for our ten worst list, but we have ten plus ten honorable mentions for the ten best.
Looking ahead, we already know three of our choices for the best and the worst of 2008: Riegel v. Medtronic, Warner-Lambert v. Kent, and Colacicco v. Apotex.
But we won't know for months yet on which side of the ledger -- top ten or bottom ten -- those cases will land.
2008 will tell.
Wednesday, December 26, 2007
Here are our choices for the ten worst drug and medical device product liability cases in 2007:
State ex rel. Johnson & Johnson Corp. v. Karl, 647 S.E.2d 899 (W. Va. 2007). It ain’t even close for the worst decision of the year. ATRA calls West Virginia a hellhole jurisdiction, and West Virginia may be proud to be on the list. By a 3-2 vote, the highest court of the state becomes the first in the country (with 47 going the other way) to reject the learned intermediary rule outright. The court does so on a DTC-advertising basis, even though: (1) there wasn’t any DTC advertising for the drug in question (so the point wasn’t briefed), and (2) by requiring warnings to be made directly to patients, the decision practically demands more DTC advertising than currently exists. A concurrence practically admits that the intent of the decision is to encourage recoveries against large, out-of-state corporations. Our posts about this case are here and here.
Ferrari v. American Home Products Corp., 650 S.E.2d 585 (Ga. App. 2007). This intermediate appellate court decision adopts an unusual reading of Bates and the presumption against preemption that would virtually abolish all forms of tort preemption, even under the Vaccine Act where Congress clearly intended it. The presumption trumps even clear congressional intent. Our post is here.
In re Zyprexa Products Liability Litigation, 489 F. Supp. 2d 230 (E.D.N.Y. 2007). A long opinion by a federal judge revered in some quarters and reviled in others for his inclination to expand tort liability as a means of effecting social change. (Given what we do for a living, we prefer law that is predictable, rather than unpredictably expansive. We realize that, come the revolution, it's our doors they'll be kicking in. We'll be cowering under our desks.) The decision rejects both implied conflict preemption and any deference to the FDA preemption preamble. The explication of the plaintiffs’ maximal position is very well presented. Our post is here.
Myers v. Hoffman-La Roche, Inc., 170 P.3d 254 (Ariz. App. 2007). This is a terrible learned intermediary decision, involving birth defect warnings that are about as explicit as humanly possible. Contrary to the great weight of precedent, the court holds that drug companies must warn doctors not only about product risks, but also about how to treat those risks – as if trained physicians don't know that depression adversely affects patient compliance. Not only that, but the decision permits a cause of action that, in everything but name, is a claim for “wrongful life.” All that can be said for this decision is that it involved a motion to dismiss rather than for summary judgment, so the defendants can try again on a full record. We didn’t post about this one before.
McDarby v. Merck & Co., Inc., 2007 WL 4206840 (N.J. Super. Law. Div. Aug. 7, 2007). We don’t care what the reasoning is, any decision that awards plaintiffs $3.7 million in attorneys' fees (and costs) for recovering $4045 in actual damages is simply wrong. Our post is here.
Notmeyer v. Stryker Corp., 502 F. Supp. 2d 1051 (N.D. Cal. 2007). Funny things happen when preemption meets tort law. Despite Ninth Circuit law (Papike) strongly indicating that the appellate court would follow the majority rule, this trial court instead opted to follow the only circuit (the Eleventh in Goodlin) that does not find broad preemption where the FDA has specifically decided that a Class III PMA device is safe and effective. We never posted separately about this one. If 2008 is good to the drug industry, the Supreme Court's decision in Riegel v. Medtronic (expected in Spring to early Summer 2008) will implicitly turn Notmeyer around.
In re Vioxx Products Liability Litigation, 501 F. Supp. 2d 776 (E.D. La. 2007). Another adverse prescription drug implied preemption decision in major litigation. It makes our bottom ten list over a number of others because of the length the decision, and its refusal to give more than minimal deference to the FDA’s decisionmaking process. We mentioned this case only in passing because of a combination of Bexis’ involvement with Vioxx litigation and Herrmann's sloth.
Wawrzynek v. Statprobe, Inc., 2007 WL 3146792 (E.D. Pa. Oct. 25, 2007). The court rules that a fraud on the FDA claim isn’t preempted where the FDA actually found fraud. That much is at least a debatable point. What makes it a bad decision is that the FDA never found that the only defendant left in the case actually committed any fraud. Our post is here.
In re Guidant Corp. Implantable Defibrillators Products Liability Litigation (Duron), 2007 WL 1725289 (D. Minn. June 12, 2007). The latest of several decisions in defibrillator litigation that finds new and creative ways of avoiding Buckman and allowing plaintiffs to pursue fraud-on-the-FDA claims in common-law tort suits. We didn’t post about this one specifically, because we’d covered this issue elsewhere in 2006. Perhaps a favorable decision in Warner-Lambert v. Kent will bar this type of decision in 2008 and beyond. (We're living proof that hope springs eternal within the human breast.)
That's it for the ten worst of '07.
We know that you can hardly wait, but we'll be posting the ten best of '07 -- and a couple of honorable mentions -- before the year is out.
Saturday, December 22, 2007
We have just three things to say:
Ho, ho, and ho!
Unfortunately, we can't yet post a link to the brief. The brief is not yet available on the SG's website, and, given the holidays and all, neither of us is able to create the necessary link. [Update: At long last, here's a link to the brief.]
But trust us, when you finally see the brief, you'll like it!
On the things that matter to the pharmaceutical industry as a whole, the SG didn't miss a trick. In Levine itself, Levine's claims "are impliedly preempted by the FDCA because they challenge labeling that FDA approved, after being informed of the relevant health risk, based on its expert weighing of the risks and benefits of requiring additional or different warnings. The Vermont Supreme Court's contrary conclusion rests on [a] mistaken view." Brief at 7.
The discussion then opens with this delightful subheading:
FDA’s approval of a drug, including its labeling, gen-
erally preempts state law claims challenging the
drug’s safety, efficacy, or labeling
Id. at 8.
The SG then analogizes between the premarket approval process for medical devices and the approval process for drugs, concluding that both involve careful consideration of the safety and efficacy of the product and the propriety of the labeling. (Needless to say, that analogy raises the stakes in the pending case of Riegel v. Medtronic, where the Court will decide the preemptive effect of the PMA approval process for medical devices.)
The SG then puts the lie to the usual plaintiff's argument that the FDA merely polices minimum standards of drug safety. A "warning in a drug’s labeling must strike a balance between notifying users of potential dangers and not unnecessarily deterring beneficial uses." Brief at 10-11. FDA thus interprets the Food, Drug and Cosmetic Act "to establish both a ‘floor’ and a ‘ceiling’ with respect to drug labeling." Id. at 11.
Next up is the standard plaintiff's contention that the Change Being Effected regulation permits a manufacturer to make unilateral changes to drug labeling. We've been saying repeatedly that that ain't so, and the government squarely agrees with us: "If manufacturers were free to make unilateral changes to labeling the day after FDA’s approval, based on information that was
previously available to FDA, the approval process would be greatly undermined and the agency’s careful balancing of risks and benefits thwarted." Id. at 12. Manufacturers can add warnings about newly-discovered risks from drugs, but not known risks that the FDA previously considered. Id. at 13. And, the SG points out, the FDA's view on that issue is entitled to Auer deference. Id. at 14.
The brief goes on to explain that the 1962 Amendments to the FDCA did not displace ordinary implied preemption principles (id. at 15), and that the Preemption Preamble and the generally applicable rule of decision discussed in the SG's Levine brief are consistent with the law of implied preemption. Id. at 18.
Finally, the only arguable fly in the ointment: The SG does not recommend that the Supreme Court immediately grant certiorari in Wyeth v. Levine, but rather recommends that the Court hold the case pending its decisions in Riegel and Kent. (One of our earlier posts about Riegel and Kent is here.) That doesn't particularly bother us. That leaves open the possibility of a win for industry after Riegel and Kent come down, or a grant of cert after the decisions in Riegel and Kent, or a grant of cert next Term in another case that presents the same issue raised by Levine. (This issue isn't going away any time soon.) Any of those results are okay with us.
The Supreme Court may or may not grant cert despite the SG's recommendation that the Court hold Levine temporarily. The Court did, after all, grant cert in Riegel despite the SG's recommendation to the contrary.
As for the timing of all this, the Court is likely to decide whether to accept Levine at its January 11, 2008, conference.
If the Court chooses to hold Levine, then the stakes go way up in Riegel and Kent, and the stakes also go up in Colacicco. Because the Third Circuit already heard argument in Colacicco (on December 10), Colacicco is likely to be decided before the Supreme Court decides Kent (which is not scheduled for argument until February 25.)
2007 was fun, but 2008 is going to be a blast!
And to all a good night!
Friday, December 21, 2007
We're sure the Journal noticed the huge spike in traffic.
Today, we're doing the same favor for the New York Times. Today's Times reports that plaintiffs' lawyers have filed a motion to amend the Vioxx settlement. Plaintiffs' counsel want to be permitted to recommend that some, but not all, of their clients accept the settlement.
We don't have much to add to what's already been written.
The original settlement agreement seemingly requires participating plaintiffs' counsel to advise all of their clients to accept the settlement; counsel must withdraw from representing any clients who reject it. Ethicists have suggested that this may pose a problem, because the participating lawyers would not be giving individualized advice tailored to the interest of each particular client. (This item at Point of Law links in turn to others speaking to the ethics issue.) Plaintiffs' counsel now seek to change the settlement agreement to give them more flexibility and to avoid charges of unethical conduct.
More flexibility, however, would let plaintiffs' counsel cherry-pick which clients would accept the settlement and which would reject it. That would predictably mean that plaintiffs with weaker cases would take Merck's money, but plaintiffs with stronger cases would reject the settlement and continue their lawsuits against Merck. That would be bad news for Merck, which is trying to buy near-global peace.
There's surely more to come on this front; keep your eye on the issue.
Oh, yeah: New York Times -- no need to thank us for this plug. We're happy to do what we can to support the faltering print media.
Thursday, December 20, 2007
The "Rule Of Construction" -- Clarifying Or Confounding The Preemption Debate About Prescription Drug Warnings?
Following passage by Congress in September 2007 of the Food and Drug Administration Amendments Act of 2007, P.L. 110-85 (the “2007 Act”), one of the most intriguing questions being asked in Washington (and elsewhere) is what effect, if any, will the 2007 Act and its “Rule of Construction” have on preemption jurisprudence in prescription drug cases when it becomes effective in March 2008.
The statute itself provides scant guidance for predicting how courts will interpret and apply the new law. In that respect, the 2007 Act is an unfortunate but not infrequent example of the legislative process providing less clarity and more uncertainty. Despite (or perhaps because of) the statutory ambiguity, individual members of Congress were undeterred from providing trenchant sound bites for both sides of the preemption debate in the days preceding passage of the 2007 Act.
Depending upon which member of Congress rose to speak on September 19-20, 2007, the 2007 Act either “clarified” Congressional intent that the Federal Food, Drug and Cosmetic Act (the “Act”) does not preempt state tort law on the adequacy of prescription drug warnings, or it left intact the views expressed by the U.S. Food and Drug Administration (“FDA”) that the Agency is the ultimate arbiter of the form and content of safety information about prescription drugs. See The Final Labeling Rule – Requirements on Content and Format of Labeling for Human Prescription Drugs and Biological Products, 71 Fed. Reg. 3922-3997 (FDA Jan. 24, 2006).
Significantly, members of Congress did not publicly comment on what was absent from the 2007 Act – the express anti-preemption language found in “Discussion Drafts” of H.R. 2900, the original House bill that was reconciled with S. 1082 to become H.R. 3580 and, ultimately, the 2007 Act. The House deleted this language prior to passage of H.R. 2900 and the language is not part of the law enacted by Congress and approved by President Bush. See P.L. 110-85. Despite the explicit rejection of such language, remarks by some Congressional opponents of preemption seemed more apropos to the draft legislation that contained the anti-preemption proviso rather than to the statute from which such language had been deleted.
Several members of Congress stated that the 2007 Act expressly preserved what they considered to be the “balance of responsibility” between FDA and pharmaceutical companies to ensure full disclosure of health risks to consumers at the earliest possible moment. In their view, section 901 of the 2007 Act unequivocally endorses this shared responsibility because it endows FDA with new authority to require manufacturers to update product labeling, while the Rule of Construction preserves the manufacturers’ responsibility to update package labeling in the face of a newly-discovered risk through the existing “changes being effected” (“CBE”) system. For these members of Congress, the 2007 Act leaves intact state law requirements and remedies, including product liability lawsuits, which are regarded as being akin to a private regulatory mechanism to hold manufacturers accountable if they do not provide prompt and adequate warnings of a prescriptions drug’s risks.
Even though Sen. Kennedy (D-Mass.) concedes that the 2007 Act “provides FDA with additional resources and authority to better able to step in when a company fails to live up to these responsibilities [to update product labeling],” this improved and expanded FDA oversight of post-market drug safety “does not undermine or preempt the efforts by injured patients to seek redress under State product liability law.” Cong. Rec. S11833 (Sept. 20, 2007). Sen. Leahy (D-Vt.) shares his colleague’s view and strongly criticized the “regulatory preemption model” that he claimed the Bush Administration was using to shield corporations from liability – a model he found “especially troubling” in the area of pharmaceutical drugs.” Cong. Rec. S11834 (Sept. 20, 2007). Sen. Leahy left no doubt about his views on preemption under the 2007 Act when he said “[t]he legislation we are set to pass today contains a ‘rule of construction’ making clear that Congress has again decided that we are not preempting State law regarding the responsibility of drug manufacturers to immediately notify consumers of dangers without waiting for the FDA to act.” Id. (emphasis added).
To be sure, the opinions of Sen. Kennedy and Sen. Leahy did not receive unanimous acclamation. Sen. Coburn (R-Ok.) expressed a diametrically opposite view about the purpose of the 2007 Act and Congressional intent in enacting the legislation. He stated:
This bill ensures that the FDA has broad and exhaustive authority to
make sure drug companies are doing the right and scientifically-justified thing
when it comes to drug safety and labeling of their drugs. This authority
is placed rightly in the hands of highly-trained scientists at the FDA. It is clear that Congress relies on the scientists of the FDA to assess
safety risks and drug labeling and this should be squarely and solely
the FDA’s role – that is why we have spent months and months
trying to get the issue of drug safety right.
* * * * *
The newly expanded role of the FDA does and should preempt
State law when it comes to drug safety and labeling.
Cong. Rec. S11839 (Sept. 20, 2007 (emphasis added). In addition, Sen. Hatch (R-Utah) praised the legislation because it establishes “a new and enhanced mechanism for the prompt consideration of new safety-related information and sets forth strict timelines for evaluation of such data.” The Utah Republican added that the “new procedure is designed . . . to ensure that FDA is the ultimate authority in making certain that drug labels convey safe information in a clear and consistent way.” Cong. Rec. S11835 (Sept. 20, 2007) (emphasis added).
But remarks by individual members of Congress often remind us that there are “two sides of the aisle” in our federal legislative bodies. For example, Rep. Green (D-Tx.) supported passage of the 2007 Act because the Rule of Construction makes it “perfectly clear” that all prescription drug lawsuits based on failure to warn are not preempted.” Cong. Rec. H10598 (Sept. 19, 2007) (emphasis added). In contrast, Sen. Enzi (R. Wyo.) was deeply concerned about provisions in the 2007 Act relating to labeling changes and liability of prescription drug manufacturers. He worried that “we do not fully understand the implications of [the] language [in the Rule of Construction]. [It] was part of the House-passed language and not something the Senate fully debated.” Cong. Rec. S11833 (Sept. 20, 2007) (emphasis added).
Given these conflicting remarks, one might reasonably wonder whether Messrs. Kennedy, Leahy, Coburn, Hatch, and Greene all read the final version of the legislation. Nor is it difficult to understand why statements by individual legislators rarely carry the day when courts find it necessary to review the legislative history. Basic principles of statutory construction dictate that, “when the statute’s language is plain, the sole function of the courts – at least where the disposition required by the text is not absurd – is to enforce it according to its terms.” Lamie v. United States, 520 U.S. 1, 6 (1997). See also United States v. Gonzalez, 520 U.S. 1, 6 (1997) (“there is no reason to resort to legislative history” when a “straightforward statutory command” exists particularly where “the legislative history only muddies the waters.”); Thornburg v. Gingles, 478 U.S. 30, 44 (1986) (committee reports are “the authoritative source for legislative intent”). The House Report on the 2007 Act does not say anything about the Rule of Construction. The Senate did not issue a report. And, it is not entirely clear that Congress used the traditional process of convening a conference committee to reconcile the differences between H.R. 2900 and S. 1082. Compare OMB Watch, Congress Expands FDA User Fee Program, Reforms Drug Safety Process, Sept. 25, 2007 (“[n]egotiations between the two chambers stalled and Congress did not form a conference committee to reconcile the two bills. Because of the need to finalize the legislation by Sept. 30, Rep. John Dingell (D. Mich.) introduced Sept. 19 the Food and Drug Administration Amendments Act of 2007 (H.R. 3508), which was based on the two bills.”) and Cong. Rec. H10594, Sept. 19, 2007 (Rep. Dingell stating that “[s]ince July, bipartisan meetings have been held frequently between House Energy and Commerce Committee and the Senate Committee on Health, Education, Labor, and Pensions to reconcile the differences between these two bills.”).
Rule of Construction
So, what’s all the hullabaloo about the Rule of Construction? Tucked away in section 901(a) of the 2007 Act, the Rule will likely draw close scrutiny from the preemption bar. Section 901(a) creates a new sub-section (o) to Section 505 of the Act (21 U.S.C. §355) dealing with Post Market Studies and Clinical Trials Regarding Human Drugs, Labeling, and Risk Evaluation and Mitigation Strategies. Generally, this section gives broad and comprehensive new powers to FDA over prescription drugs, especially in the product’s post-marketing period, but then imposes on drug manufacturers the obligations under existing law to make appropriate and necessary changes to safety information in package labels. Section (o)(4)(I) provides as follows:
RULE OF CONSTRUCTION – This paragraph shall not be construed to affect the
responsibility of the responsible person or holder of the approved application
under section 505(j) to maintain its label in accordance with existing
requirements, including subpart B of part 201 and sections 314.70 and 601.12 of
title 21, Code of Federal Regulations (or any successor regulations).
H.R. 3580, Title IX, §901(o)(4)(I) (2007).
Perhaps the only true thing that might be said to date about the 2007 Act and its Rule of Construction is that they have not quieted the preemption debate about prescription drug warnings and probably will not do so until their content is explained by judicial interpretation.
S. 1082 and H.R. 2900 become H.R. 3580
The impetus for Congressional consideration of this legislation was the expiration on September 30, 2007 of the Prescription Drug User Fee Act (“PDUFA”). Although the law eventually passed by Congress is far more comprehensive than simply reauthorizing “user fees,” the 2007 Act is sometimes referred to as the PDUFA Reauthorization Package.
The Senate was the first body to consider the legislation, passing on May 9, 2007 the FDA Revitalization Act (S. 1082) by a vote of 93-1. Initially, the House considered nine separate bills that ultimately were consolidated into the Food and Drug Administration Amendments Act of 2007 (H.R. 2900), which passed on July 11, 2007 by a vote of 403-16.
The compromise bill emerged on September 19, 2007 as the Food and Drug Administration Amendments Act of 2007 (H.R. 3508) and passed the House that same day by a vote of 405-7. The Senate approved the measure the next day by unanimous consent and President Bush signed the 2007 Act into law on September 27, 2007.
While S.1082 re-authorized the user fee program, it did much more. Section 208 of S.1082 essentially eliminated the “changes being effected system” under the Act by requiring FDA approval for all labeling changes, whether initiated by the Agency or the manufacturer, and establishing an “accelerated” process for considering them. Sen. Kennedy endorsed this version of the Senate bill despite the likelihood that language in an amendment proposed by Sen. Burr (R-N.C.) would be interpreted as requiring FDA to review and approve all labeling changes.
Sen. Kennedy accepted the Burr amendment because the provision added to FDA’s authority. Undoubtedly, it did, but it also did much more -- it strengthened the preemption defense in prescription drug cases by essentially eliminating the CBE system which, according to The Pharmaceutical Research and Manufacturers of America, “doesn’t really exist in practice.” The Pink Sheet, “Preemption Remains Conference Issue in FDA Bill as Both Sides Declare Victory,” Vol. 69, No. 30, July 23, 2007.
Perhaps sensing the consequences of his support for the Burr Amendment, Sen. Kennedy tried to establish a much different legislative intent for the bill that he sponsored during a floor speech on May 9, 2007, the day the Senate passed S. 1082. Despite the language of the Burr Amendment, Sen. Kennedy wanted to have it both ways:
“[w]e do not intend to alter existing state law duties imposed on the holder of
an approved drug application to obtain and disclose information regarding drug
safety hazards either before or after the drug receives FDA approved
labeling. Nor are we expressing a belief that the regulatory scheme
embodied in the bill is comprehensive enough to preempt the field or every
aspect of State tort law. FDA’s approved label has always been understood
to be the minimum requirement necessary for approval. In providing the
FDA with new tools and enhanced authority to determine drug safety, we do not
intend to convert this minimum requirement into a maximum.”
Cong. Rec. S5764 (May 9, 2007) (emphasis added).
As approved, the Senate bill added a section 506D to the Act entitled “Safety Labeling Changes” to be inserted after 21 U.S.C. §356c. It required FDA and drug manufacturers to notify each other if either became “aware of new safety information that … should be included in the labeling of the drug.” Thereafter, discussions would ensue between FDA and the drug maker to determine whether a “safety labeling change” is appropriate. See S. 1082, Title II, §208 at pp. 107-117 (2007).
These discussions to review possible labeling supplements would occur on a normal or accelerated process, with the accelerated process limited to 45 days. Upon expiration of the 45-day period, the Senate bill would require FDA, “on the next calendar day,” to request in writing that the manufacturer make any safety labeling change that FDA determines to be necessary or to notify the manufacturer that no change is “necessary or appropriate.” If FDA fails to act within the prescribed period or the manufacturer does not agree to adopt FDA recommendations, either the manufacturer or FDA could refer the matter to a Drug Safety Oversight Board (the “Board”), which has 45 days in which to make a recommendation. Id.
After the Board issues its recommendation, FDA must issue an order within 20 days, either requiring the manufacturer to make necessary and appropriate safety labeling changes or determining that no safety labeling change is required. Should FDA fail to act, the Board’s written recommendation will be considered the order of the Secretary of Health and Human Services. If the manufacturer fails to comply with the order of FDA or the Board’s recommendation within 10 days of receipt, the drug at issue may be misbranded. Id.
It did not take very long following Senate approval of S. 1082 for the plaintiffs’ bar to recognize that preemption advocates had achieved a significant legislative victory. To complement FDA statements in the Final Labeling Rule that the Agency is the ultimate arbiter of the form and content of safety information for prescription drugs, the Senate had now passed a law requiring FDA approval of all label changes – effectively eliminating the CBE system, which the plaintiffs’ bar frequently invokes to counter the preemption defense in prescription drug cases since FDA’s publication of the Final Labeling Rule in January 2006. But the plaintiffs’ bar worked very quickly to undo what was now a double-barreled argument for preemption.
By the time the House Subcommittee on Health held a hearing on June 12, 2007 to consider its version of the new legislation, Health Subcommittee Chairman Rep. Frank Pallone (D-N.J) had already circulated “Discussion Drafts” of what would become H.R. 2900. These “Discussion Drafts” contained language that would expressly eliminate the preemption defense in prescription drug actions. Each of the “Discussion Drafts” circulated by Rep. Pallone contained the following language:
Sec. 6. RULE OF CONSTRUCTION REGARDING FEDERAL PREEMPTION
Nothing in this Act or the amendments made by this Act may be construed as
having any legal effect on any cause of action for damages under the law of any
State (including statutes, regulations, and common law).
The American Institute for Justice, formerly known as the Association of Trial Lawyers of America, claimed in an e-mail to members that its lobbyists were responsible for the inclusion of the anti-preemption language. The e-mail stated:
“This week, our Public Affairs Department worked hard to get a provision in a
draft drug safety legislation which could prevent drug companies from using the
FDA as a shield against accountability for the harm they cause – and we were
Young, Jeffrey, The Hill, “Trial lawyers win on suit provision threatens FDA Bill,” June 15, 2007. See, e.g., H.R. ____ To Amend the Federal Food, Drug and Cosmetic Act to improve drug safety and for other purposes (House Energy Committee Discussion Draft), §6 at p. 58 (June 6, 2007).
This is definitely anti-preemption language. Similar language in the Occupational Safety and Health Act (“OSHA”) reads:
“Nothing in this chapter shall be construed . . . to enlarge or diminish or
affect in any other manner the common law or statutory rights, duties, or
liabilities of employers and employees under any law with respect to injuries,
diseases, or death of employees arising out of, or in the course of,
29 U.S.C. §653(b)(4). The OSHA law has been interpreted as restricting preemptive effects of OSHA regulations in tort suits. See, e.g., Lindsey v. Caterpillar, Inc., 480 F.3d 202, 209 (3d Cir. 2007); Pedraza v. Shell Oil Co., 942 F.2d 48, 53 (1st Cir. 1991); and In re Welding Fume Products Liability Litigation, 364 F.Supp. 2d 669, 686 (N.D. Ohio 2005).
At the June 12, 2007 hearing, the Health Subcommittee heard testimony by Randall Lutter, Ph.D., FDA’s Deputy Commissioner for Policy, who expressed the Agency’s concerns with the new language eliminating FDA’s preemption authority.
“[W]e are concerned about new language on preemption in the discussion
drafts, which states that nothing in the Act may be construed as having any
legal effect on actions for damages under state law (including statutes,
regulations, and common law). This language appears in each of the draft bills
and relates to both drugs and devices.
With respect to drugs, FDA is the expert federal public health agency
charged with ensuring that drugs are safe and effective and that the labeling
adequately informs users of the drugs’ risk and benefits. FDA . . .
provides formal, authoritative conclusions under which drugs can be used
safely and effectively. * * * We believe that State law actions
that can conflict with the Agency’s conclusions and frustrate the Agency’s
implementation of its public health mandate should not be endorsed in federal
Statement of Randall Lutter, Ph.D., Deputy Commissioner for Policy, Food and Drug Administration, Before the Subcommittee on Health Committee on Energy and Commerce, U. S. House of Representatives (June 12, 2007) (emphasis added). An FDAnews Marketing and Sales Bulletin dated June 14, 2007 quotes Dr. Lutter as saying that “[t]he best way to ensure safety of the medical process is to ensure there is a single authoritative voice,” and explaining that the House drafts would essentially formalize a collection of state actions that could be contradictory to FDA’s regulations. FDANEWS, “FDA Raises Concerns with House PDUFA Draft Legislation,” Vol. 2 No. 24, June 14, 2007 (emphasis added); see also The Food & Drug Letter, “Debate Over Preemption Provision in FDAAA Continues,” Vol. No. 781 (Sept. 28, 2007).
Despite the inclusion of obvious anti-preemption language in the draft legislation, a spokeswoman for the Health Subcommittee explained that Democrats were not trying to roll back preemption. “We are not attempting to change the status quo on preemption,” she said. Instead, the Democrats want to forestall the expansion of federal preemption into new areas of drug and device law. Young, Jeffrey, The Hill, “Trial lawyers win on suit provision threatens FDA Bill,” June 15, 2007 (emphasis added).
Apparently, Dr. Lutter’s comments did not go unheeded. The Health Subcommittee postponed its scheduled June 14, 2007 markup of H.R. 2900 until June 19, 2007 “to allow for further negotiation on preemption and other issues.” The Pink Sheet, “Negotiations Preempt Subcommittee Markup,” Vol. 69 No. 25, June 18, 2007. Significantly, the anti-preemption language found in the draft discussions was not included in the bills presented at the June 19, 2007 Health Subcommittee markup, and the House Committee on Energy and Commerce did not re-insert the language when it marked up H.R. 2900 on June 21, 2007. H.R. 2900 was introduced in the House on June 28, 2007 and passed on July 11, 2007 by a vote of 403-16.
In the House version, FDA also had authority to compel changes in labeling to reflect new safety information within specified time periods but, significantly, the House bill did not require FDA approval of all changes in package labeling for prescription drugs, as did the Senate version. Thus, the Rule of Construction in H.R. 2900 arguably left intact the responsibility of drug manufacturers to maintain their labels in accordance with existing requirements, including Subpart B and section 314.70 of title 21, Code of Federal Regulations (or any successor regulations). See H.R. 2900, Title IX, §901(o)(4)(I).
Eventually, the Senate and House bills were reconciled in H.R. 3580 and received Congressional approval. The “reconciliation” process produced the following issues that could be significant in the preemption debate about prescription drug warnings:
- FDA has new and expansive powers to regulate prescription drug safety information in the post-marketing period and, for the first time, FDA is not limited to the “nuclear option” of pulling a drug from the market but, instead, can compel drug makers to make FDA-initiated changes to package labeling and impose civil and criminal penalties for non-compliance;
- The “reconciliation” process eliminated the Senate bill’s provision that manufacturers could not make any label change without prior FDA approval; and
- The Rule of Construction qualifies the sweeping and expansive regulatory authority given FDA over prescription drug warnings in section 901(a) by leaving intact the manufacturers’ responsibility under the “changes being effected” system to initiate label changes for new safety information.
So – what does all of this mean for preemption of state product liability lawsuits alleging inadequate warnings for prescription drugs?
The new law significantly expands FDA’s power on labeling issues because the Agency can now compel manufacturers to make changes it deems necessary and appropriate to provide new safety information. Rep. Waxman (D-Cal.) highlighted the significance of this change:
“Mr. Speaker, the legislation poised [sic] to pass today provides FDA, for
the first time, critical tools that the Agency has been desperately lacking
in its efforts to protect the American public from unsafe drugs.”
Cong. Rec. H10598 (Sept. 19, 2007). (emphasis added).
However, the House excised the Senate’s key provision on labeling that likely would have been interpreted as a de facto endorsement of preemption in prescription drug cases – i.e., pharmaceutical companies could make no change to package labeling without prior approval by FDA. The House further muddied the preemption waters by then enacting its version of the Rule of Construction which, to be sure, will be invoked by the plaintiffs’ bar as re-affirming the CBE system in an effort to weaken drug manufacturers’ reliance on the Final Labeling Rule as a basis for preemption.
The rejection of explicit anti-preemption language in House drafts of the 2007 Act, coupled with the significant expansion of FDA power to regulate post-market prescription drug warnings – taken together – significantly weaken any argument that the Rule of Construction somehow “trumps” the 1996 Final Labeling Rule and eliminates the preemption defense in prescription drug cases. In fact, such a scenario was expressly discussed and rejected by Sen. Coburn (R-Ok.) in his remarks prior to passage of the legislation:
“I want to specifically comment on language in H.R. 3580 [the 2007 Act] that
includes a new mechanism to further encourage the timely and accurate
communication of new safety information on prescription drug labels. That
mechanism reiterates the FDA’s primacy in determining the content of
prescription drug labeling, including through the new power to command a safety
labeling change. New section 505(o)(4)(I) also makes clear that this
enhanced safety labeling mechanism does not affect the obligation of a company
to maintain a drug product’s labeling in accordance with FDA’s regulations,
including 21 C.F.R. Sec. 314.70 . . . Nothing in this rule of
construction changes that obligation or FDA’s ultimate authority over drug
labeling; nor is it intended to change the legal landscape in this
area. That is because there is an overriding federal
interest in ensuring that the FDA, as the public health body charged with
making these complex and difficult scientific judgments, be the ultimate
arbiter of how safety information is conveyed.”
Cong. Rec. S.11849 Sept. 20. 2007. (emphasis added).
Although FDA now has unilateral authority to compel changes in the form and content of prescription drug labeling, the 2007 Act leaves intact the CBE system that existed when FDA published the Final Labeling Rule in the Federal Register on January 24, 2006. While Congress did not eliminate the regulatory framework for company-initiated changes to package labels that existed when the Final Labeling Rule was published, it certainly had the opportunity to expressly repudiate the views expressed by FDA in that document and, significantly, it did not expressly do so in the 2007 Act.
In fact, an interpretation of the Rule as maintaining the regulatory “status quo” finds support in both the language of the Rule and remarks by Sen. Kennedy, who sponsored the legislation. In this regard, the Rule could be construed as a “savings clause” that preserves the regulatory status quo and deters preemption advocates from interpreting the 2007 Act as evidence that Congress, by giving FDA broad and unprecedented authority over prescription drugs in the post-marketing period, intended to extend FDA regulatory supremacy beyond its existing scope. Sen. Kennedy’s remarks support such an interpretation. He said:
“Congress has stated very clearly in the legislation that we do not intend the new authority being given to FDA to preempt common law
liability for a drug company’s failure to warn its customers of health
Cong. Rec. S.11833 (Sept, 20, 2007). (emphasis added).
Undoubtedly, the plaintiffs’ bar will attempt to persuade courts that the Rule of Construction demonstrates Congressional intent to thwart drug manufacturers’ reliance on the preemption defense. In response, pharmaceutical companies can forcefully argue that: 1) Congress rejected the explicit anti-preemption language sought by the plaintiffs’ bar and did not disavow FDA views expressed in the Final Labeling Rule; 2) the language of the Rule of Construction is, at best, inconclusive, as evidenced by conflicting Congressional opinions about the preemptive effect of the Act of 2007; and 3) the advertent purpose of the 2007 Act was to give FDA new and sweeping regulatory power in the collection and dissemination of drug safety information during the post-marketing period. All of these factors portend Congressional support for FDA primacy in regulating prescription drug warnings.
Notwithstanding these and many other words that will be written about the 2007 Act, a prediction today about its effect on preemption jurisprudence for prescription drugs has but one certainty – the 2007 Act did not provide an unequivocal answer for either side of the debate. Rather, it will be left to the courts, perhaps on a case-by-case or product-by-product basis, ultimately to determine whether company-initiated warnings pursuant to the “changes being effected” regulations provide a basis for product liability suits under state law when FDA has concluded that “the determination whether labeling revisions are necessary is, in the end, squarely and solely FDA’s under the Act.” Requirements on Content and Format of Labeling for Human Prescription Drugs and Biological Products, 71 Fed. Reg. at 3934 (FDA Jan. 24, 2006). (emphasis added).
The Supreme Court may have an opportunity to address this question should it grant certiorari and take up the case of Levine v. Wyeth, 2006 Vt. LEXIS 306 (October 27, 2006). It has invited the Solicitor General to file a brief expressing the views of the United States, and it is generally believed that such a brief will be filed soon.
Developments in this case will be closely watched. If the Supreme Court decides to hear the Levine case, this observer will be interested to see whether the Court considers the jury verdict in favor of plaintiff Diana Levine to be a state requirement for additional or stronger product warnings or, instead, a prohibition on an approved and indicated use for a prescription drug.
Tuesday, December 18, 2007
South Florida, parts of Texas, Chicago, West Virginia, Las Vegas, and Atlantic City make the "hellhole" list, while Madison and St. Clair Counties, in downstate Illinois, drop to a "watch" list.
Three of ATRA's hellhole designations were due, at least in part, to treatment of pharmaceutical actions. These are:
2. RIO GRANDE VALLEY AND GULF COAST,TEXAS The Rio Grande Valley and Gulf Coast of Texas have made their way into each and every Judicial Hellholes report since the project's inception. It is recognized as one of the toughest places in America for corporate defendants to receive a fair trial. This year, there was ... a judge's "pocket veto" of an appeal of a $32 million award against a pharmaceutical company in a case where a juror knew and had taken loans from the plaintiff..... Despite strong statewide legislative reforms enacted in 2004, this area stubbornly refuses to shed its Judicial Hellholes reputation.
4. WEST VIRGINIA West Virginia courts have earned a reputation for anti-business rulings,massive lawsuits and close relationships between the personal injury bar,state attorney general and the judiciary. It is almost unique among the states in providing civil defendants with no assurance that they will receive appellate review, and, as one of the cases highlighted in this year's report shows,this can leave a business hit with a multimillion-dollar verdict with nowhere to turn. The West Virginia Supreme Court of Appeals,when it does act, has cast a shadow on the reputation of the state's judicial system. This year, it rejected a rule that places responsibility of warning patients of the risks of most drugs solely with their doctors, not pharmaceutical companies who do not know the patient's medical history....
Despite its Hellholes reputation, however, it is important to note that there are many judges that adhere to the law in West Virginia....
6. ATLANTIC COUNTY, NEW JERSEY Personal injury lawyers seem to have gained a monopoly in Atlantic County, a new addition to the Judicial Hellholes report. New Jersey is known for particularly plaintiff-friendly laws, admitting junk science in court and hosting lawsuits from all over the country against their state's own economic driver, the pharmaceutical industry. All these elements were on display in the Vioxx litigation in Atlantic County. There is also evidence that litigation fairness is deteriorating throughout the Garden State, leading to the formation of the New Jersey Lawsuit Reform Alliance in October 2007.
Read 'em and weep.
The difficulty, of course, is that, until all jurisdictions are even-handed, the judicial system as a whole is skewed. If every court in the country were fair except Nowheresville, Alaska, then our clients would disproportionately be sued in Nowheresville.
Plaintiffs get to choose the forum of the lawsuit, so a single hole pops the entire dike.
Oh, well. Maybe there's a decent restaurant in Nowheresville.
Your law firm sends you a lengthy legal analysis of a new federal statute that applies to your industry. You pay them a ton of money for this legal advice and fully expect this advice to remain between you and your attorneys. You certainly don’t expect to have to produce the analysis to litigation adversaries because, if anything is protected by the attorney-client privilege, this is.
If you’re in Pennsylvania, not so fast. The Pennsylvania Superior Court’s decision in Nationwide Mutual Insurance Company v. Fleming, 2007 PA Super 145, 924 A.2d 1259 (2007), takes a narrow, “one-way street” approach to the attorney-client privilege. (Disclosure: My firm represents Nationwide, but not in this matter; I have not represented Nationwide.) There, the trial court had found that, by producing two documents voluntarily, Nationwide waived its attorney-client privilege claim for a third document based on the “subject matter” waiver rule. On appeal, the intermediate appellate found that, because neither of the two produced documents was privileged, there was no “subject matter” waiver as to the third document.
But the Superior Court did not stop there; instead, it then examined the attorney-client privilege claim for the document at issue, a memorandum by an attorney in Nationwide’s general counsel’s office addressed to fifteen Nationwide employees. According to the Superior Court, the document discussed “on-going efforts to manage agent defections” and “outline[d], … in general terms, counsel’s opinion as to the likely outcome of current and pending litigation.” Id. at ¶ 29.
Applying Pennsylvania’s statutory attorney-client privilege and focusing on only the attorney-client privilege (i.e., not on the work product protection, which apparently was not asserted), the Superior Court found that “[c]ommunications from counsel to a client may be protected …., but only to the extent that they reveal confidential communications previously made by the client to counsel for the purpose of obtaining legal advice.” Id. at ¶ 27 (citations omitted) (italics in original). Because the document at issue “d[id] not disclose any confidential communications by … the client, to its counsel” -- but only by counsel, to the client -- the Superior Court found that the document was not privileged and ordered it produced.
This approach certainly is not the majority rule, as federal and state courts outside of Pennsylvania have considered and rejected it repeatedly. See, e.g., Sprague v. Thorn Ams., Inc., 129 F.3d 1355, 1370 (10th Cir. 1997) (surveying federal authorities, but interpreting Kansas attorney-client privilege law); In re LTV Sec. Litig., 89 F.R.D. 595, 602 (N.D. Tex. 1981) (federal common law); Spectrum Sys. Int’l v. Chem. Bank, 78 N.Y.2d 371, 379, 581 N.E.2d 1055, 1060 (1991) (New York law); see generally Uniform Rules of Evidence 502(b) (1986 rev.); Restatement (Third) of the Law Governing Lawyers § 69, comment i (2000). But the Pennsylvania Superior Court’s approach in Fleming is not unique, either. See, e.g., Tax Analysts v. I.R.S., 117 F.3d 607, 618 (D.C. Cir. 1997) (referencing In re Sealed Case, 737 F.2d 94, 99 (D.C. Cir. 1984), and Mead Data Central Inc. v. U.S. Dep’t of Air Force, 566 F.2d 242, 254 (D.C. Cir. 1977)); Loftis v. Amica Mut. Ins. Co., 175 F.R.D. 5, 9-10 (D. Conn. 1997) (predicting Connecticut law).
The Pennsylvania Supreme Court recently agreed to hear an appeal in Fleming, 2007 Pa. LEXIS 2361 (Oct. 31, 2007), so the Superior Court’s decision may not be the last word. For now, however, Fleming shows that not much has changed in Pennsylvania since Ben Franklin observed that “in this world nothing can be said to be certain, except death and taxes.”
Monday, December 17, 2007
Are we weird, or what?
We posted about Thomson itself here. And we followed up here and here.
Although we may be weird, we're not alone. Pharmalot picked up the story here, and the Civil Procedure Prof Blog picked it up here.
Once more, with feeling, my friends:
Now comes Fields v. Organon, No. 07-2922, slip op. (D.N.J. Dec. 12, 2007) (a link to the slip opinion here). Fields is the same thing all over again: Plaintiff pled a product liability claim in New Jersey state court against the manufacturer of the contraceptive NuvaRing. The defendants included Akzo Nobel NV, a Dutch company, and its Organon subsidiary, which has its principal place of business in New Jersey. Organon was "clearly a legitimate defendant" (slip op. at 7), but it followed the Thomson playbook, removing the case before Organon had been served with the complaint.
Judge Chesler didn't like the Thomson playbook. He held that permitting resident defendants to remove before serivce of the complaint "eviscerate[s] the purpose of the forum defendant rule." Id. at 8. A "literal interpretation" of the removal statute, 28 U.S.C. Sec. 1441(b), "creates an opportunity for gamesmanship by defendants, which could not have been the intent of the legislature." Id. Judge Chesler thus granted plaintiff's motion to remand.
Two thoughts: First, if courts will speculate as to whether the legislature intended to "create opportunities for gamesmanship," then it's time to throw out the entire Internal Revenue Code. Congress drafts, and lawyers devote their lives to looking for loopholes. That's kind of the way it works, isn't it?
Second, the score appears to be one and one on this issue in federal courts in New Jersey. (A string cite in footnote 3 of Fields suggests, however, there may be another local case or two on point. We haven't yet looked.) So the issue in in play.
Orders remanding cases, such as Fields, are of course not appealable, so the Third Circuit will never be reviewing one of those. Orders denying motions to remand are typically reviewable only after the case goes to judgment, which takes a long time.
So that's the only thing we know for sure: It's likely to be a long time before we see a definitive answer to this question.
On the other hand, on the off-chance that you missed it, take a look at the op-ed piece by Scott Gottlieb (former Deputy Commissioner of the FDA) that appeared in today's WSJ. Gottlieb argues that companies should not be prosecuted criminally for providing true information about drugs that saves lives. Imagine that!
Also, if you haven't yet heard about former FDA Commissioner David Kessler's recent woes at UCSF Medical School -- the school fired him -- Pharmalot has the story.
Sunday, December 16, 2007
1. Herrmann used his best material on this crowd. He explained that only one person in the world tells MDL jokes -- and it's him, of course! He then told his two MDL riddles (which reflect not his own personal views, but the views of certain jaded lawyers who have lived through an unsuccessful MDL or two):
Why is an MDL like The Field of Dreams?
If you build it, they will come.
Why is an MDL like a Roach Motel?
Cases check in, but they never check out.
Okay, okay. You come up with an MDL joke that's actually funny.
2. The American Tort Reform Association has a website that collects the status of tort reform in all fifty states. Click here for a map of the United States; then, click on the state that interests you to find out what tort reforms have been enacted and whether they've been upheld as constitutional.
3. During the Colacicco oral argument, apparently one judge asked whether the drug company had proposed, and the FDA had refused, the very warning that the plaintiff now says should have been given. The implication was that perhaps only that conflict is sufficiently stark to trigger implied preemption. This is just silly.
First, in Colacicco, members of the public had filed Citizens' Petitions asking the FDA either to ban, or to add warnings about suicidality to, SSRI antidepressants. That's about as stark a conflict as exists in the real world.
Second, if courts require companies to request, and the FDA to reject, specific warnings to trigger preemption, then drug companies will be encouraged to bombard the FDA with proposed warnings. Companies will submit defensive filings meant to tee up issues before the FDA and get decisions, one way or the other. Precisely that concern -- that drug companies would give the FDA more information than it needed or wanted -- motivated the Supreme Court in Buckman to find that claims of fraud on the FDA are preempted.
Finally, no matter what proposed warning the drug company submits to the FDA, plaintiff's counsel in a later lawsuit will say that the warning should have been slightly different. It should have been a "warning" instead of a "precaution;" or a statement that an adverse reaction was "caused" by the drug, rather than "associated" with it; or the quantification of the rate at which the adverse event occurred was misleading.
It's not possible to propose the very warning that a plaintiff will later seek, because, no matter what the warning says, the later plaintiff will see the existing warning and say it wasn't any good. That's how litigation works; we sure hope the Third Circuit isn't fooled.
4. Why Riegel (the device preemption case argued last week) may inform Levine (the drug preemption case with a certiorari petition pending): Since express preemption in the device context turns on whether a federal requirement conflicts with a state requirement, the express preemption analysis can feel an awful lot like the implied preemption analysis for drugs. Thus, depending on how the Supreme Court resolves Riegel, we may get a pretty strong sense of what's likely to happen when the Court decides Levine (or some other drug preemption case presenting the same issue).
5. Finally, a thought on how companies might want to conduct themselves under the new Final Labeling Rule, effective in 2006, that adds a Highlights section to the package insert: Don't just delete adverse events from the label because they're too insignificant to list under the new labeling regime. Rather, write to the FDA saying that you propose to delete the adverse event. If the FDA agrees in writing with the deletion, then you've built your necessary regulatory record to establish preemption. If the FDA disagrees with the deletion, continue to list the adverse event.
See? It's happening already! If preemption turns on causing the FDA to speak on a particular issue (to show a conflict), then companies will do everything in their power to entice the agency to speak. Unless we want a system that's terribly distorted by companies and the FDA doing a constant preemption tango, conflict preemption must exist more broadly than only when the FDA has considered and rejected a specific warning.
Friday, December 14, 2007
Wednesday, December 12, 2007
Starting, as is proper with defendant/petitioner Warner Lambert’s brief, it’s probably appropriate to remind readers what the precise question is that the Supreme Court has agreed to decide:
Whether, under the implied preemption principles of Buckman Co. v. Plaintiffs’ Legal Committee, 531 U.S. 341 (2001), federal law preempts state law to the extent it permits or requires a fact-finder to speculate as to whether a defendant improperly disclosed information to the federal agency that materially affected the agency’s decision to approve or not withdraw the drug.
W-L br. at i. Our first impression of this case is that, from a defense perspective, the statute at issue is our friend. In some ways, that’s ironic, because we also want to have it nullified through preemption. But the express terms of statute make it clear that this is really fraud on the FDA that the Michigan legislature was concerned with. That’s because, the statute’s exception involves not just a misrepresentation to an agency – but intent, materiality and reliance as well. The exception is limited to a manufacturer that:
Intentionally withholds from or misrepresents to [FDA] information concerning the drug that is required to be submitted under the federal Food, Drug, and Cosmetic Act, and the drug would not have been approved, or [FDA] would have withdrawn approval for the drug if the information were accurately submitted.
Mich. Comp. Laws §600.2946(5)(a) (emphasis added). Plaintiffs trying to avoid preemption love to try to recharacterize claims as somehow more benign than they are. That’s going to be rather hard to pull off in Kent since, if this statute isn’t describing fraud on the FDA, it’s hard to see what would.
The first part of Warner-Lambert’s argument isn’t even described as “argument.” Rather, what’s called the “statutory background” in the initial “Statement of the Case” (W-L br. at 3-11) amounts to a carefully sculpted non-argumentative argument that goes to one of the linchpins of the Supreme Court’s earlier analysis of fraud on the FDA preemption in Buckman Co. v. Plaintiffs’ Legal Committee, 531 U.S. 341 (2001) – that’s (1) all of the many ways in which the FDA receives information from regulated manufacturers, and (2) all of the many ways the FDA can send fraudsters to jail or do other unpleasant things to them.
Item (1) goes to the many ways that fraud on the FDA claims could gum up the regulatory scheme by inducing manufacturers to give the Agency more than it wants or needs. Item (2) goes to the authority that the FDA has to back up the congressional decision that the Agency – and only the Agency – is authorized to enforce alleged violations of the FDCA.
From our lawyerly perspectives, what’s neat about this “argument” is that it’s not really argument at all, but simply a straightforward recitation of the ins and outs of the regulatory scheme. Yet it makes two of the most critical points necessary to bring this case within the area controlled by Buckman – all without any real “argument” at all. In short, it’s legal ju jitsu at its best. It’s always a pleasure to read good advocacy. And of course, for all you lawyers out there looking to save a research step or two, plagiarism is the sincerest form of legal flattery.
There’s one other practical thing that this section of the W-L brief should make clear to anyone litigating the defense side of this type of litigation. That’s the wealth of regulatory information and statistics available on the FDA’s website. A word to the wise should be sufficient, so if you don’t already, learn how to navigate and use the FDA’s site. The W-L brief contains a half dozen different citations to FDA materials in this section alone. That’s as many URLs as we’ve ever seen in a Supreme Court brief not involving patent litigation.
We’re also particularly gratified to reacquaint ourselves with a couple of our old Bone Screw regulatory favorites. There’s a nice discussion (W-L br. at 9-10) of 21 U.S.C. §337(a), which explicitly provides that all enforcement of the FDCA “shall be by and in the name of the United States.” There’s also a paragraph about §336, which authorizes the FDA to use warning letters for anything it considers to be a “minor violation,” that cleanly segways into a discussion of the Agency’s prosecutorial discretion. The parallelism isn’t at all surprising, since Buckman was a Bone Screw case, and we bone screwers pioneered use of these sections in preemption litigation.
Footnote 7 on page 12 of the W-L brief contains the definitive list of other similar state statutes that will be affected by the Court’s ruling, whatever that ruling might be. Thankfully, that list agrees with ours (wiping sweat from our brows).
After a rather lengthy review of how this particular case came to be what it was (sure, it’s rather boring, but it’s just a fact of life that MDL mass tort proceedings are just plain complicated), we finally get to the real defense argument – what this post is all about. First, there’s the mandatory discussion of the various forms and flavors of preemption (W-L br. at 20-22).
After that, there’s the introduction of Warner-Lambert’s major theme, which is that there’s preemption here because the statutorily-mandated fraud on the FDA investigation necessarily puts the state-law jury in the position of making “what if” determinations about what the FDA might have done had the defendant given it some other, different information. W-L br. at 22. That’s absolutely necessary here because the assault on federal authority inherent in statutes of this sort is a little less frontal and blatant than the self-described fraud on the FDA claim in Buckman. In that earlier case, state-law juries were being invited simply to ignore in-force FDA regulations if they found fraud. Here should a jury find fraud that would have caused the Agency to remove the product, then the jury forgets (theoretically) the whole FDA business and instead is presented with a pre-statute common law tort case under Michigan common law as it predated the tort reform statute that included the offending provision.
That difference, however, is not enough to escape Buckman. Not hardly. The statute still puts state-law juries smack dab in the middle of an area that Buckman held was none of the states’ business – overseeing the interactions between a federal regulatory body and the persons that it regulates. And right there is where our old friends §337(a) and §336 come in.
[T]he duty of the manufacturer to the agency is strictly federal in character. Thus, it is only appropriate that the regime should be administered solely by federal officials, in accordance with federal standards. Put another way, because the FDCA “touch[es] a field in which the federal interest is so dominant” – i.e., policing fraud against the federal agency – involving duties created by federal law and owed to a federal agency, “the federal system will be assumed to preclude enforcement of state laws on the same subject.”
W-L br. at 23 (citations omitted). That’s a broad preemption argument, indeed, but where §337(a) mandates exclusive prosecutorial authority, and §336 mandates broad prosecutorial discretion, conflict and field preemption tend to merge. Precisely because it’s a broad argument, we’d like it to be the rationale that prevails. Almost since Buckman has been decided, courts have tried to chip away at it, something we’ve discussed before. This argument is precisely what’s needed to make Buckman as bulletproof as any precedent can possibly be.
That the statute is a known quantity, not an amorphous common-law claim, helps matters. It’s elements – an intentional, material misrepresentation to the FDA that induced an agency action that otherwise would not have happened – seek to extend state law into the heart of the FDA’s exclusive, discretionary authority. That’s why, after laying out the maximal argument, W-L turns directly to the nature of the statutory exception. W-L br. at 24-25 (“[e]ach one of these [statutory] findings involves the state fact-finder in the interpretation and application of federal statutes and regulations that are, by congressional directive, subject exclusively to federal oversight”). The statutory terms leave the plaintiff only limited room to bob and weave.
After making its affirmative preemption argument, Warner-Lambert turns to the adverse effect of allowing the Second Circuit’s ruling to stand. These are:
- Regulatory matters requiring “application of specialized scientific and public health knowledge” would instead be decided by innumerable non-expert juries. (W-L br. at 26-27, 33-34).
- The FDA’s interpretation of its own rules would not control in private, civil litigation, both creating uncertainty and lessening the Agency’s authority (W-L br. at 27).
- As a defense mechanism against this uncertainty, manufacturers would likely provide more information than the FDA wants or can easily handle (W-L br. at 27).
- Even if there were fraud, lay juries would impose more severe penalties than the FDA thought advisable (W-L br. at 27-28, 34-35).
- The “FDA would be forced to monitor, assess, and possibly engage in a multitude of lawsuits across the country,” including Agency personnel being diverted from their jobs to have to testify (W-L br. at 28).
Instead of being the FDA, the Agency would become the “Food, Drug & Litigation Administration.” Id. Nice touch, guys.
Having made its “A” argument, Warner-Lambert turns to the uniformity implications of statutes like Michigan’s. This is more of a conflict-by-obstruction argument than the previous exclusive authority point, which emphasized inherent incompatibility. In this particular instance, the FDA neither found fraud nor even ordered the drug off the market. W-L br. at 30. But the statute necessarily requires plaintiffs to prove precisely the opposite in order to maintain their suits. Id. In effect the statute usurps the role of the FDA and hands regulatory enforcement determinations to state-law courts and juries. Id. at 30-31. Buckman, however, said “no” to precisely this:
[T]he Buckman Court concluded that policing fraud on federal agencies is a function reserved to the Federal Government, and was delegated to FDA in the FDCA context. Recognizing that the agency itself bears the responsibility to police fraud consistently with its judgment and objectives, the opinion made clear that any attempted showing by a third-party that FDA had been defrauded would upset the delicate balance of statutory objectives implicated in FDA decisionmaking under the FDCA.
W-L br. at 31 (Buckman cites and quotation marks omitted). Were it otherwise, FDA would no longer have the final say, burdens upon both the Agency and those it regulates would skyrocket, and FDA would find its mission distorted by litigation. Id.
Warner-Lambert then begins to take on the Second Circuit’s rationale by pointing out the various ways in which the elements of the statutory exception in no way resemble the proof in “traditional’ product liability litigation. Br. at 32-33. In particular, there’s none of the traditional proximate cause that’s ordinarily required under the learned intermediary rule. Instead, “The fact-finder essentially would be required to determine either that FDA (i) never should have approved the drug, or (ii) should have removed it from the market earlier, because of allegedly fraudulent disclosures to the agency.” Id. at 33.
Because, as previously mentioned, there is no adverse FDA fraud finding in this case, Warner-Lambert was in the enviable position of offering the two concurring Justices in Buckman (Stevens and Thomas) their possible exception to preemption for instances where the FDA has concluded it was defrauded. W-L br. at 36-37. We don’t particularly agree with that exception as a legal matter (since it contradicts the point about prosecutorial discretion and excessive jury remedies), but we understand it. A lawyer’s first obligation is to win the client’s case. We’d take the same position under the same circumstances.
Having made its affirmative arguments, Warner-Lambert then levels its broadside at the Second Circuit’s rationale. As we discussed probably too much in a prior post on Desiano (what Kent was named in the Second Circuit) it’s a target rich environment. There’s a lot there to take issue with the Second Circuit’s reasoning and result.
Most blatantly, the Second Circuit resorted to the old saw – the presumption against preemption – despite the unanimous Supreme Court holding in Buckman that there could be no such presumption because states did not “traditionally” interfere with the relationship between a federal regulatory agency and those it regulated. That’s pretty much what Warner-Lambert says in its brief:
This Court in Buckman already conclusively held that there is no presumption against preemption because policing fraud against federal agencies is hardly a field which the States have traditionally occupied. Buckman, 531 U.S. at 347. Nonetheless, the Second Circuit opinion places an impermissible “thumb on the scale” by framing respondents’ claims as simply invoking the traditional province of the states to safeguard the health and safety of their citizens, rather than a federal issue.
W-L br. at 38. There is no need to “look beyond the clear holding of Buckman to determine that no presumption against preemption applies.” Id. at 40.
What Michigan did was to adopt a federally-set standard as a boundary for state tort law. There’s nothing that says a state can’t do that, in the abstract (indeed, the Michigan Supreme Court already said so as a matter of state law), but whatever its merit, such an adoption isn’t “traditional” by any stretch of the imagination. Id. at 39. Since preemption is not seeking to displace any “traditional” state function, there’s no basis for an adverse presumption.
Very politely, Warner-Lambert informs the court that the Second Circuit’s view of the rationale for Michigan’s law (which betrayed the Second Circuit’s real wish to strike down on the whole statute on state-law severability grounds that, inconveniently, the Michigan Supreme Court had already rejected) just didn’t accord with reality or common sense. Rather the “very premise” of the Michigan statute was to restructure state law along federal lines. Id. To construe the presumption against preemption as the Second Circuit had was simply unprecedented – and contrary to well-established authority:
In any event, the court below cited no authority holding that a presumption against preemption is assessed by the supposed purposes rather than by the operation and effect of the state-law provision at issue. In fact, the actual function of the provision is what matters.
Id. (citations omitted).
Having deflated the presumption already, Warner-Lambert ends with a broader argument that we’d really like to see adopted. That’s the rather undeniable fact that health and safety issues involving prescription drugs aren’t a “traditional” state law area of regulation to begin with. To the contrary, the federal government and the FDA have dominated this realm “[f]or more than a century.” Id. at 40-41. It’s a dandy little argument, and if it won it would oust the presumption from all prescription drug product liability litigation – whether or not concerning fraud on the FDA. And if the Second Circuit’s disregard of the unanimous Buckman decision ticks off enough justices…. Well, who knows?
Warner-Lambert hits the home stretch strongly with what was our biggest gripe against what the Second Circuit had done in Desiano, which is to neuter Buckman by making it into a mere pleading bump in the road – in other words, a plaintiff could allege fraud on the FDA as much as s/he wanted as long as it wasn’t called “fraud on the FDA.” As Warner-Lambert forthrightly points out, that “improperly elevates form over function.” W-L br. at 42.
It does not matter to the analysis that the cause of action in Buckman was denominated fraud-on-the-FDA, while the cause of action in this case incorporates agency fraud as a prerequisite to traditional tort liability. . . . Rather, the focus in Buckman was on the practical effect of the adjudication of the claim: whether it would involve the fact-finder in an area committed to federal regulation, thereby creating an inevitable conflict with the federal scheme.
W-L br. at 43. That’s it in a nutshell. Buckman came out the way it did because of the adverse effect such claims had on FDA authority, FDA functioning, and FDA decisionmaking. It doesn’t matter how state law gets to this point, but once it purports to authorize juries to re-examine FDA decisions for purported taints of fraud, all of these adverse consequences inevitably flow.
Since it’s Christmastime – an apt analogy is that the wrapping isn’t more important than what’s inside the box.
Warner-Lambert’s brief ends with a lot of argument that’s pretty well tailored to the particular circumstances of the case, but it makes one additional point of general interest. It analogizes preemption of fraud on the FDA claims to the considerations underlying the “complete preemption” doctrine. That’s a little much to explain in a couple of sentences, but basically, it’s been the case for decades, that a plaintiff who mixes a federal issue of sufficient magnitude into a state-law claim, can wind up in federal court because federal law “completely preempts” the ability of state law to decide that question. It’s not really “preemption” in the usual sense of the word, but more a means of creating jurisdiction in a federal court over a case that wouldn’t otherwise qualify. If you’re a glutton for punishment, we discuss complete preemption more here.
The analogy is that the relationship between a federal agency and those it regulates presents the same sort of inherently federal issue that the Supreme Court’s complete preemption cases try to delineate:
Extrapolating from. . .complete preemption principles, irrespective of whether the fraud-on-the-FDA inquiry is taken as an element of a state claim or a showing required of a plaintiff to overcome an affirmative defense, the federal issues here are so closely interwoven with the state claims that the resolution of the latter necessarily depends on determination of the former. No matter how postured, [proving fraud on the FDA involves] subjects within the purview of the constitution akin to those which trigger the importance, and even necessity of uniformity of decisions throughout the whole United States.
W-L br. at 49 (citations and quotation marks omitted).
As far as the defense amici (that’s how “amicus” is pluralized – “one amici cannot get on a bus, because one amici is two amicus” (sorry, Tom L.)), the most important, is (of course) the United States Department of Justice’s brief. In fact, that one’s so important we’ve already given the DoJ brief the honor of its own post. That post pretty much covers the DoJ brief. Go read it there, if you haven’t already – every click improves our stats, if nothing else.
Now on to the usual suspects. A familiar face in the Kent case is amicus the Chamber of Commerce. It’s brief makes a number of unique arguments. First – and one that’s near and dear to our hearts – the Chamber addresses whether there should even be a presumption against preemption in a conflict preemption case. CoC br. at 2 n.2, 8-20. The Chamber asks the Court “to clarify once and for all that the presumption against preemption simply does not apply to the analysis of whether state law conflicts with federal law.” Id. at 5.
The applicability of any presumption against preemption to conflict preemption is an incredibly important issue, since it impacts not only implied preemption of fraud on the FDA claims, but implied preemption of tort claims involving prescription drugs generally. As we pointed out in our own post, this presumption is notable by its absence in all of the Supreme Court’s recent conflict preemption rulings. The Chamber’s argument against any presumption in conflict preemption is as well-developed as any we’ve read, and we highly recommend it. The main points:
- For most of the Court’s history, there was no presumption against preemption, and (if anything) a there was a presumption in favor of preemption in conflict cases. CoC br. at 8-9.
- The presumption against preemption arose in field preemption cases, and from there spread – as a maxim of statutory construction – to express preemption cases. CoC br. at 9-10.
- “[A]lmost without exception” no presumption against preemption has been employed in the Court’s implied preemption cases. The few exceptions have been “prefatory” and the presumption did not actually factor into those decisions. CoC br. at 10-11.
- The Court’s rationale in Geier v. American Honda Motor Co., 529 U.S. 861 (2000), United States v. Locke, 529 U.S. 89 (2000), and Sprietsma v. Mercury Marine, 537 U.S. 51 (2002), strongly indicate that application of a presumption against preemption to implied preemption cases is inappropriate. Coc br. at 12-14.
- There’s no basis for any presumption against preemption in the text of the Supremacy Clause – that is what part of “Supreme Law of the Land” don’t the plaintiffs understand? CoC br. at 14-15.
- The “federalism concerns” offered in support of the presumption against preemption were not voiced by the Framers themselves, and in any event were resolved by the adoption of the Supremacy Clause. CoC br. at 15-17.
- A presumption might be justified where it is necessary to infer congressional intent to preempt in the absence of a conflict that brings the Supremacy Clause directly into play. CoC br. at 17-18.
- “Conflict preemption is different,” and does not depend upon any inference of intent, but rather upon the existence and extent of a substantive conflict between supreme federal law and state law. CoC br. at 18-19.
- Because it arises only from conflicts, implied preemption is not dependent upon expressions of congressional intent. CoC br. at 19.
- Once an actual conflict is identified, the Supremacy Clause dictates that state law is nullified to the extent of the conflict. CoC br. at 20.
Straightforward application of the Supremacy Clause. . .facilitates the realization of Congress’s objectives and affords private actors – particularly in regulated fields – an important measure of legal certainty and predictability. The “day” has come for the Court to “consider” the presumption in the conflict preemption context, and to hold that the presumption has no applicability there.
CoC br. at 20 (citation omitted).
We hope that the Court will take up the Chamber’s request. Unless and until that happens though, anybody who’s serious about using implied preemption in the prescription drug arena – actually, in any tort case – needs to understand the argument made in the CoC brief and be prepared to make it themselves. It’s that important, trust us.
The remainder of the Chamber’s argument is, while typically excellent, not of the same level of importance – simply because it’s more closely limited to the specific statute and facts of the Kent case. Primarily the Chamber debunks the rationale by which the Second Circuit, in the teeth of the unanimous Buckman decision to the contrary, concluded that the presumption against preemption applied to a case involving fraud on the FDA. Fraud on the FDA involves neither traditional “state police power” nor an “area” in which states typically regulate. CoC br. at 21-22. The same thing, the relationship between a federal regulator and the regulated, is at issue in Kent as in Buckman. CoC br. at 23-24.
Secondarily, the Chamber makes the points: (1) All Buckman preemption does here is preempt the predicate that allows a state-law cause of action to be brought. It isn’t preemption – but rather Michigan Supreme Court’s state-law ruling on severability – that results in the plaintiff not being able to pursue the tort claim itself. Thus, the plaintiffs’ complaints about “immunity” are misplaced, since it is state, rather than federal, law that created immunity. Coc br. at 27-28. (2) The Second Circuit erred in judging preemption in light of its estimation of the motivation, as opposed to the effect, of the state law. Id. at 29-30. (3) State law that bears upon inherently federal matters, such as fraud on a federal agency, is inherently incapable of threatening police powers as to which states have “historical primacy.” Id. at 30-31.
Fortunately amicus briefs are shorter than those the parties are entitled to file, or else we’d be here all day.
Like the Chamber, the Product Liability Advisory Council (“PLAC”) has appeared in Kent just like it did in Riegel. The first thing we notice is PLAC’s listing, in its statement of interest (PLAC br. at 2), some other “significant preemption cases” it’s briefed. Number one on that list is Wyeth v. Levine, which remains pending. That’s a nifty little nudge that the Court should take Levine. We agree. Nice touch there.
PLAC’s job (we can talk about that since one of us belongs) is to bring a broader perspective to the courts than do the parties. Thus we’d expect PLAC to broaden the impact of Kent – which is precisely what it does:
Adoption of the court of appeals’ approach could unleash plaintiffs in tens of thousands of pending cases – not to mention future ones – to seek damages against drug and Medical device manufacturers based on their dealings with FDA, even where FDA itself is entirely satisfied with the manufacturers’ candor. Inevitably, the proliferation of cases linking liability to the adequacy of companies’ disclosures to FDA will upset the somewhat delicate balance of statutory objectives FDA has struck in deterring and punishing fraud against the agency.
PLAC br. at 5 (citation and quotation marks omitted). That’s good, but for once we think even PLAC may have understated things. The Kent case isn’t just about the FDA – it’s about state-law claims of fraud on NHTSA (cars), on EPA (chemicals), on CPSC (toys, other consumer products), on DOA (veterinary medicine, meat contamination), and on just about any other federal agency that might find it’s decisions open to question in a tort suit.
PLAC goes through its own exegesis (br. at 6-10) describing the FDA’s information requirements and enforcement powers. Doing that is sort of the price of admission in this type of case. If you’re writing a fraud on the FDA brief, you’ll want to look at it (especially where it discusses the 2007 FDAAA), but otherwise it’s frequently plowed ground by now.
We’ll mention one practice pointer that we notice on page 7. There’s a raft of Westlaw citations to various relevant FDA Guidance documents. If you brief FDA issues, you should be aware of and use the new Westlaw library that makes a wide range of FDA regulatory materials a lot more accessible to those of us who aren’t regulatory specialists. Between the Westlaw library and the FDA’s Google-powered website, it’s incomparably easier to research FDA-specific issues than it was when we first tried to do that back in the Dark Ages of Bone Screw (all of 13 years ago).
PLAC then cuts to the chase. The Second Circuit’s distinction between fraud on the FDA as a cause of action and “mere” fraud on the FDA allegations is “illogical” – “even on its own terms.” State intent (or lack of it) has never been what preemption was all about:
There is no hint. . .that preemption – through application of a presumption or otherwise – turns on a state’s intent to regulate. Nor does the question whether state law “stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress” depend on whether the state intended it to do so. To hold otherwise would mean that states can override and obstruct federal law so long as they are merely negligent in doing so. In other words, while insisting that Congress would not “cavalierly” override state law, the court of appeals would encourage states to be cavalier in obstructing federal law. If intent were the litmus test for preemption, Buckman would have been a dead letter from the day it was written. This Court instead adopted a functional approach.
PLAC br. at 12-13 (various citations omitted). It simply can’t be less preemptive for a state to interfere with federal function accidentally as opposed to on purpose. The Second Circuit’s attempt to graft a mens rea requirement onto conflict preemption doesn’t make any sense.
Allowing “anything goes short of an actual cause of action for fraud on the FDA,” id. at 15, doesn’t make any more sense. Imposing a fraud on the FDA element in the context of an exception to an immunity statute has the same practical effects, since the “Michigan statute requires such proof in every case.” Id. The Desiano court has reasoned “circularly” because it had assumed at the outset, what it endeavored to prove – “That virtually any litigation of fraud on the FDA short of a stand-alone cause of action. . . could contribute only marginally to any regulatory overload.” PLAC br. at 16. Like Warner-Lambert, PLAC dips into complete preemption case-law for an apt description of the inherently federal nature of fraud on the FDA:
A federal enactment can be a “critical element” in the plaintiffs’ case without being the exclusive tenant in its own cause of action. This Court has recognized as much in cases finding federal jurisdiction where an issue of federal law is lodged within a state claim. . . . The Court applie[s] a practical, functional test for determining if such a claim arises under federal law – whether the state-law claim necessarily raises a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionally approved balance of federal and state judicial responsibilities. Here, plaintiffs’ claim clearly raises [such] a federal
Id. at 16-17 (citation and quotation marks omitted).
PLAC is even more dismissive of the Second Circuit’s distinction between a fraud on the FDA cause of action labeled as such (preempted under Buckman) and mere fraud on the FDA allegations (not preempted). That identical allegations – one labeled “fraud on the FDA” and the other embedded in some other claim – would have diametrically opposed fates was “form” being given “more importan[ce] than substance.” “To state the proposition is to refute it.” PLAC br. at 18.
Perhaps because it was also involved in Riegel, PLAC closes with an interesting comparison between the two pending cases. The Second Circuit’s reasoning in Desiano, PLAC argues, could render any decision in Riegel “essentially moot.” PLAC br. at 19.
Under the Second Circuit’s reasoning, Plaintiffs could simply claim that, in securing approval of the PMA or a PMA Supplement, the manufacturer concealed the truth from FDA. That would allow a case to go forward and would render the express preemption provision in the Medical Device Amendments virtually inoperative.
Id. That means, in short, that “the Second Circuit’s logic allows virtually any collateral attack under state law on FDA determinations.” Id. at 21. That’s an interesting – and chilling – thought.
Another repeat amicus customer in the Washington Legal Foundation (“WLF”). It’s brief takes a different track in arguing that federal involvement in the regulation of prescription drugs is greater than it is in medical devices and thus the case for preemption is even greater in Kent than in Buckman. WLF supports this argument by relying upon Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996), and Lohr’s rather dismissive characterization of the §510k “substantial equivalence” approval system for medical devices. Since Buckman also involved a §510k device, FDA involvement was necessarily at a lower level of intensity than either the PMA process for medical devices (that’s the Riegel case) or the NDA process for drugs (that (we hope) is the pending certiorari petition in Levine). WLF br. at 3-8.
In that way WLF rather nicely constructs an a fortiori argument. It also lets WLF spend some time on (WLF br. at 9) the FDA’s January 24, 2006 Final Rule preemption preamble for drugs. Since the Second Circuit went out of its way to denigrate the preemption preamble in Desiano, turnabout’s fair play, we suppose.
WLF also takes a different approach to the presumption against preemption, which )as anybody who’s read this far can tell), looms large in Kent. WLF’s tack is that there can be no such preemption where the state-law claim infringes upon a federal agency’s “primary jurisdiction.” WLF br. at 10-14. Fraud on the FDA allegations infringe in two ways: (1) they take away the Agency’s non-reviewable prosecutorial discretion; and (2) they invade the Agency’s authority over the approval, and withdrawal of approval, of new drugs.
WLF also bolsters the Chamber’s argument that there is no presumption against preemption in conflict preemption cases. WLF br. at 14-21.
Since Kent is a drug case, the pharmaceutical industry’s trade association, PhRMA, also weighs in. Much of the first half of PhRMA’s brief is spent hammering home the practical and legal similarities between fraud on the FDA as asserted in Buckman and as asserted in Kent and, conversely, refuting the Second Circuit’s attempted distinctions. PhRMA br. at 6-11. In the end, it is impossible go obscure that both involve a “state’s assertion of power to review the regularity of FDA approvals under state law,” id. at 3 – a quite pithy way of putting things. In doing so, PhRMA probably conducts the most thorough examination of Buckman of all the defense amici.
Because it serves as the pharmaceutical industry’s trade association, PhRMA also spent more time than any other amicus in addressing purported “industry” statements in the Buckman oral argument that – rather incredibly – the Desiano opinion chose to rely upon instead of the Buckman decision itself. PhRMA br. at 12-15. PhRMA also makes many of the arguments involving the presumption against preemption (not applicable to conflict preemption, actua. conflict obviates need to consider congressional or state intent, agency fraud not a traditional area of state regulation). Id. at 15-22. We won’t go into these arguments at any length, not because they’re not worth it, but because we’ve already discussed them, we’re getting tired, and our readers would rightly criticize us for being repetitive.
PhRMA also provides its own “obstruction” argument, which contains another comprehensive discussion of FDA information requirements imposed upon regulated manufacturers and FDA remedies for suspected fraud. PhRMA br. at 22-24. It points out that a literal reading of Desiano would allow fraud on the FDA claims even where the Agency had affirmatively determined that it had not been defrauded. PhRMA br. at 24-25. It closes with an argument that the “materiality” requirement for fraud on the FDA works to eliminate the FDA’s expert judgment by permitting “limitless second-guessing under state law based on ostensibly unconsidered information.” Id. at 28.
A new player (at least to us) is the Generic Pharmaceutical Ass’n (“GPhA”). GPhA’s brief is probably a portent, because generic drugs are making up a larger and larger proportion of prescriptions, and thus potential product liability exposure. See GPhA br. at 12-13. GPhA concludes that the Michigan statute, with its express reliance upon federal disclosure requirements, is even further from a “traditional” state tort claim than the fraud on the FDA claim in Buckman – as the common-law claims there at least purported to track traditional elements of fraud. GPhA br. at 8. The association also punctures the facile excuse in Desiano that the fraud on the FDA exception is not really in conflict because a defendant can simply waive what the Second Circuit described as a “defense.” GPhA quite correctly exposes that argument as unrealistic, as if any “sophisticated litigant” would be “in the business of leaving dispositive statutory defenses on the cutting-room floor.” GPhA br. at 10.
Finally, GPhA also provides a generic-perspective defense – that the drain on FDA resources, both directly from diversion of Agency personnel to deal with fraud on the FDA litigation, and indirectly from sorting through the extra, unwanted information the Agency would receive, would exacerbate the backlog of generic drug applications (called “ANDAs” for you acronym aficionados). This result, GPhA argues, would run contra to the Hatch-Waxman Act’s intent “to speed the entry of generic drugs to the market. Id. at 11. It’s a bit of a stretch, but there is cause and effect.
That’s it – a complete guided tour of the defense “top side” briefs in Kent. If you practice in this area, read them carefully and use them well. A lot of the best minds in the business spent a lot of time putting together the best legal arguments in favor of preemption.
Remember, plagiarism is the highest form of legal flattery.