Showing posts with label Strict Liability. Show all posts
Showing posts with label Strict Liability. Show all posts

Wednesday, July 25, 2012

Sometimes Almost is Enough to Make Us Smile

            It’s a beautiful day in the Philadelphia area.  The humidity is down, the sun is out, the breeze is delightful.  If we were morning radio jocks, we’d be telling you to drop your briefcases and laptops and pick up your Frisbees, suntan lotion and beach chairs and head for the nearest park, lake or beach.  And so we hope that at least some of you are reading this on a portable device from one of those locations (or even reading it tomorrow when the heat gets dialed back up to sauna-like levels).   On a day like this, we don’t need much more to make us smile. And that’s why we are choosing to view the case of Doughtery v. C.R. Bard, Inc., 2012 U.S. Dist. LEXIS 100374 (E.D Pa. Jul. 18, 2012) as the glass half-full.  Actually, it is probably more like three-quarters full.  So, on this atypically pleasant day in July in the Mid-Atlantic, we envision enjoying an almost full glass of our favorite ice-cold summertime beverage (we’re envisioning an Arnold Palmer since we’re writing this before noon, but the choice is yours).

            The reason Doughtery, is an “almost” for us, is that, like so many cases that look at Pennsylvania medical device/prescription drug product liability law, it strips plaintiff of “almost” all of her claims.  For instance, we don’t think any of our readers would be surprised to learn that plaintiff will be permitted to plead a negligent failure to warn claim.  In fact, this is often the only claim left standing at the motion to dismiss stage under Pennsylvania law.  See post on Kee v. Zimmer, Inc., 2012 U.S. Dist. LEXIS 68862 (E.D. Pa. May 17, 2012).  We say permitted because plaintiff is being given a chance to amend her complaint to see if she can plead facts sufficient to withstand TwIqbal scrutiny.  Doughtery, 2012 U.S. Dist. LEXIS 100374 at *5.  Plaintiff actually included a proposed second amended complaint with her response to the motion to dismiss, but because it still included several claims that the court was dismissing with prejudice, plaintiff was sent back to the drawing board. 

            Nor do we think it comes as any surprise that plaintiff’s breach of implied warranty for fitness for a particular purpose claim and claim under Pennsylvania’s Unfair Trade Practices and Consumer Protection Law were dismissed with prejudice.  Id. at *4, 31-33.  But where this case doesn’t quite reach the point of overflowing our cup is in its discussion of strict liability.  We’ve reported on numerous cases – too many to count – that hold that Pennsylvania’s across-the-board application of Restatement §401A, comment k to drugs and medical devices bars strict liability claims.  See here , here , here, and here.  In fact, some of the cases discussed in these posts are cited in Doughtery recognizing that many courts have read Pennsylvania law “broadly to preclude all strict liability claims.”  Id. at *14.  What Doughtery, however, further recognizes is that that those courts didn’t specifically address a strict liability manufacturing defect claim and therefore weren’t controlling on that issue.  Id.   To our dismay, the court also cited to Schiff v. Hurwitz, 2012 WL 1828035 (E.D. Pa. May 18, 2012) to support the argument that Pennsylvania law recognizes strict liability in drug and device cases for something “more than a failure to warn.”  Doughtery, at *14.  We’ve made our feelings about Schiff well known here.  

            To be honest, we’ve contemplated that strict liability manufacturing defect was a door left open in Pennsylvania.  It is just so rarely pursued by plaintiffs, that it is a really tiny door.  Picture Alice standing before the 15 inch door to Wonderland and pondering how she was going to get through.  Except plaintiff’s don’t often get a magic vial that says “Drink Me” that grants them easy access to a manufacturing defect claim.  Hence, when strict liability failure to warn and design defect claims are tossed out in Pennsylvania, that usually does away with strict liability in its entirety.  Plaintiff Doughtery having expressed the desire to attempt to squeeze through that little door, the court decided Pennsylvania law permitted that opportunity.  The court’s reasoning was twofold:  (1) nothing in the lead Pennsylvania cases “unambiguously precludes all strict-liability claims against a [drug/device] manufacturer, id. at *16-17 (see discussion of cases in footnote 9); and (2) “the fact that the Pennsylvania Supreme Court decided to apply a negligence standard to failure-to-warn claims does not necessarily mean that the court would similarly adopt a negligence standard for manufacturing-defect claims.” Id. at *20.  As to point two, the court noted that the concern behind applying strict liability to drugs/medical devices in the context of failure to warn and design defect is that

if a manufacturer could not count on limiting its liability to risks that were known or knowable at the time of manufacture or distribution, it would be discouraged from developing new and improved products for fear that later significant advances in scientific knowledge would increase its liability.

Id. at *21 (citation and quotation marks omitted).   The court then reasoned that that concern is not an issue for alleged manufacturing defects.  Id. at *23 (strict liability creates proper incentives for manufacturers to adhere to good quality control practices). 

Having decided that Pennsylvania law does not bar a strict liability manufacturing defect claim, the court’s ruling on breach of implied warranty of merchantability should come as no surprise.  The Doughtery court, like many others, took the position that “the theories of strict liability and breach of the implied warranty of merchantability are parallel theories of recovery, one in contract and the other in tort.”  Id. at *29 (citation and quotation marks omitted).  As such, “comment k precludes implied-warranty claims against manufacturers of prescription drugs and devices to the same extent that it precludes strict-liability claims against such manufacturers.”  Id. at *28-29.  If strict liability manufacturing defect claims survive, so too do implied warranty claims based on manufacturing defects – or so says Doughtery.  Id. at *30. 

What’s left?  Negligence, strict liability manufacturing defect, breach of implied warranty of merchantability but only to the extent based on a manufacturing defect, and breach of express warranty.  And we have a plaintiff who has submitted at least three complaints to the court and hasn’t gotten it right yet.   So, to return to where we started, enjoying a sunny day on the East Coast, we leave you with the court’s words of caution to plaintiff and her counsel:

I caution Doughtery that she must allege sufficient facts to support an inference that an express warranty was created, including the specific source of the alleged warranty (e.g., a publication or package insert) and the specific statements made, something that she has not done in either her first amended complaint or her proposed second amended complaint.

Id. at *37, n.15.  And:

The infirmities in Doughtery's first two complaints were due, at least in part, to her counsel's apparent unfamiliarity with the applicable law. I caution Doughtery and her counsel to carefully review the relevant law before drafting and filing her second amended complaint. I am unlikely to allow a third amended complaint should her second amended complaint fail to plead adequate factual allegations or legally proper claims for relief.

Id. at *38.  We like to think of these as the prologue to Doughtery part II -- at which point our cup could well be filled to the brim.

Thursday, June 21, 2012

Odd Facts Should Not Make Bad Law

When we saw the first one we thought, that’s odd, but it’s mostly a malpractice claim pretty far from our sweet spot.  When we saw the second one, we thought, maybe we should blog about this now….  But the result was mostly unfavorable, and other, more significant things were happening.  But now that we’ve seen a third one, well we think we finally have to comment.  We don’t want the odd facts that the plaintiff pleaded (we have some difficulty believing their truth) in Schiff v. Hurwitz to mess up Pennsylvania law − any worse than it already is, that is.

First, some legal propositions:

Proposition one − No separate duty to test theory exists under Pennsylvania product liability law − period.  The relevant cases, all in our duty to test cheat sheet, are:  Lance v. Wyeth, 4 A.3d 160, 168-69 (Pa. Super. 2010), appeal granted, 15 A.3d 429 (Pa. 2011); Viguers v. Philip Morris USA, Inc., 837 A.2d 534, 541 (Pa. Super. 2003), aff’d, 881 A.2d 1262 (Pa. 2005) (per curiam); Oddi v. Ford Motor Co., 234 F.3d 136, 143-44 (3d Cir. 2000); Wolfe v. McNeil-PPC, Inc., 773 F. Supp.2d 561, 570 (E.D. Pa. 2011); Sykes v. Glaxo-SmithKline, 484 F. Supp.2d 289, 318 n.32 (E.D. Pa. 2007); Stitt v. Philip Morris, Inc., 245 F. Supp.2d 686, 694 (W.D. Pa. 2002).

Proposition two − The Food, Drug & Cosmetic Act (“FDCA”) does not give private persons a right of action to enforce it.  Buckman Co. v. Plaintiffs Legal Committee, 531 U.S. 341, 352 (2001); In re Orthopedic Bone Screw Products Liability Litigation, 193 F.3d 781, 791 (3d Cir. 1999); Gile v. Optical Radiation Corp., 22 F.3d 540, 544 (3d Cir. 1994); Sandoz Pharmaceuticals Corp. v. Richardson-Vicks, Inc., 902 F.2d 222, 231 (3d Cir. 1990); Green v. Dolsky, 685 A.2d 110, 115 (Pa. 1996); 21 U.S.C. §337(a).

Proposition three − Strict liability does not lie against the maker of a prescription medical product under Pennsylvania law − not for any type of defect (except possibly manufacturing).  Hahn v. Richter, 673 A.2d 888, 889-90 (Pa. 1996); Baldino v. Castagna, 478 A.2d 807, 810 (1984); Incollingo v. Ewing, 282 A.2d 206, 219-20 & n.8 (Pa. 1971), Lance, 4 A.3d at 164-65; Creazzo v. Medtronic, Inc., 903 A.2d 24, 31 (Pa. Super. 2006); Sykes, 484 F. Supp.2d at 318 & n.31; Soufflas v. Zimmer, Inc., 474 F. Supp.2d 737, 750 (E.D. Pa. 2001).

Proposition four − Strict liability does not lie against health care providers in Pennsylvania.  Cafazzo v. Central Medical Health Services, Inc., 668 A.2d 521, 537-38 (Pa. 1995); Coyle v. Richardson-Merrell, Inc., 584 A.2d 1383, 1386 (Pa. 1991); Kelly v. St. Mary Hospital, 694 A.2d 355, 358 (Pa. Super. 1997); Podrat v. Codman-Shurtleff, Inc., 558 A.2d 895, 897 (Pa. Super. 1989); Makripodis v. Richardson-Merrell, Inc., 523 A.2d 374, 378 (Pa. Super. 1987); Flynn v. Langfitt, 710 F. Supp. 150, 152 (E.D. Pa. 1989); Eby v. Milton S. Hershey Medical Center, 31 Pa. D. & C.4th 121, 125 (Pa. C.P. 1996).

Proposition five − Strict liability cannot be reimported into prescription medical products/health care services under the guise of a consumer fraud claim brought under the Pennsylvania Unfair Trade Practices & Consumer Protection law (“UTPCPL”), because the act is inapplicable to medically-related activities.  Walter v. Magee-Women’s Hospital, 876 A.2d 400, 407-08 (Pa. Super. 2005), aff’d, 906 A.2d 1194 (Pa. 2006); Foflygen v. Zemel, 615 A.2d 1345, 1354 (Pa. Super. 1992); Gatten v. Merzi, 579 A.2d 974, 976 (Pa. Super. 1990), Kee v. Zimmer, Inc., 2012 WL 1758618, at *4 (E.D. Pa. May 17, 2012); Zafarana v. Pfizer, Inc., 724 F. Supp.2d 545, 557 (E.D. Pa. 2010); Smith v. Bristol-Myers Squibb Co., 2009 WL 5216982, at *5-6 (D.N.J. Dec. 30, 2009) (applying Pennsylvania law); Heindel v. Pfizer, Inc., 381 F. Supp.2d 364, 374 (D.N.J. 2005) (applying Pennsylvania law); Kester v. Zimmer Holdings, Inc., 2010 WL 2696467, at *14 (W.D. Pa. June 16, 2010); Albertson v. Wyeth, Inc., 63 D. & C.4th 514, 538-39 (Pa. C.P. 2003); Crossen v. Peretz, 2002 WL 34576549 (Pa. C.P. Oct. 17, 2002); Luke v. American Home Products Corp., 1998 WL 1781624, at *8 (Pa. C.P. Nov. 18, 1998); see Beyers v. Richmond, 937 A.2d 1082, 1088 (Pa. 2007) (favorably citing and applying medical professional UTPCPL precedent to hold that lawyers were also not within the scope of the UTPCPL).

Proposition six − Hospitals have no common-law obligation to obtain informed consent to medical procedures from patients.  Valles v. Albert Einstein Medical Center, 805 A.2d 1232, 1239 (Pa. 2002); Watkins v. Hospital of the University of Pa., 737 A.2d 263, 268-69 (Pa. Super. 1999); Friter v. Iolab Corp., 607 A.2d 1111, 1114 (Pa. Super. 1992).

Proposition seven − In Pennsylvania the informed consent doctrine is not unlimited.  It extends only to the risks and benefits of surgery, specifically not including any obligation to explain the FDA regulatory status of prescription medical products to patients.  Southard v. Temple University Hospital, 781 A.2d 101, 107 (Pa. 2001).  Nor does the informed consent doctrine require disclosure of a physician’s financial interests.  Duttry v. Patterson, 771 A.2d 1255, 1259 n.2 (Pa. 2001); Corrigan v. Methodist Hospital, 874 F. Supp. 657, 659 (E.D. Pa. 1995).

Proposition eight − and probably the most important for present purposes − federal judges exercising diversity jurisdiction have no business “predicting” novel expansions of state-law liability.  They follow, and do not lead, state courts.  Day & Zimmermann, Inc. v. Challoner, 423 U.S. 3, 4 (1975); Sheridan v. NGK Metals Corp., 609 F.3d 239, 253 (3d Cir. 2010); Travelers Indemnity Co. v. Dammann & Co., 594 F.3d 238, 253 (3d Cir. 2010); City of Philadelphia v. Beretta U.S.A. Corp., 277 F.3d 415, 421 (3d Cir. 2002) Camden County Board of Chosen Freeholders v. Beretta, 273 F.3d 536, 541 (3d Cir. 2001); Leo v. Kerr-McGee Chemical Corp., 37 F.3d 96, 101 (3d Cir. 1994); City of Philadelphia v. Lead Industries Ass’n, 994 F.2d 112, 123 (3d Cir. 1993).

Second, we’ll take a look at the facts in Schiff v. Hurwitz, 2012 WL 1971320 (W.D. Pa. June 1, 2012) (hospital institutional review board’s (“IRB) motion) (“Schiff III”); Schiff v. Hurwitz, 2012 WL 1828035 (E.D. Pa. May 18, 2012) (medical device manufacturer’s motion) (“Schiff II”); and Schiff v. Hurwitz, 2012 WL 1355613 (W.D. Pa. April 18, 2012) (doctor’s motion) (“Schiff I”), as they’re pleaded. That’s all we have to go on since all three Schiff opinions decide Rule 12 motions to dismiss.  Maybe these weird allegations will become less beguiling when the pleadings can be pierced.  Here's hoping, anyway.

The plaintiff’s allegations in Schiff − which we have a hard time believing − are that the defendant medical device manufacturer sold a Class II device (that means no preemption under Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996)) called “Invasix” that the FDA had cleared for marketing and labeling for certain uses.  The plaintiff, however, allegedly did not use the device for any of those labeled uses.  Instead, the plaintiff alleges that she was provided the device in the context of some sort of underground, non-FDA authorized clinical trial of a new use.  This underground trial purportedly was conducted like a clinical trial, in that her surgeon was an “investigator” and the trial was carried out under the auspices of the defendant hospital IRB.  In accordance with the usual trappings of a clinical trial, the plaintiff signed a written agreement under which she was to receive money for participating in the trial and any medical expenses from adverse events suffered in what amounted to a medical experiment would be paid for.  Plaintiff alleged that the manufacturer defendant, in order to avoid the FDA's clinical trial requirements, falsely represented (it's not clear to whom) that the new use had no safety issues.  The plaintiff further claims that she was not informed of any safety risks by anyone − in particular that the defendant surgeon’s informed consent discussion omitted mention that she didn’t fit within the trial’s protocol and didn’t mention any safety risks.  Then, of course (since this is a product liability action), plaintiff suffered injury from those risks.  Plaintiff also claimed she wasn’t informed that the defendant surgeon “was a paid investigator.”  Schiff I, 2012 WL 1355613, at *1-2; Schiff II, 2012 WL 1828035, at *1-2; Schiff III, 2012 WL 1971320, at *1-2.  We’ve seen a lot of claims in several decades of practice, but we've never encountered allegations of an under-the-table or off-the-books clinical trial before.  That's the source of our skepticism about whether the pleaded facts in Schiff are true, or even could be true.  But there’s always a first time….

On these purported facts, the plaintiff in Schiff alleged (at least) the following general theories:  (1) against the treating surgeon:  UTPCPL violations; (2) Against the manufacturer (Invasix): negligence, strict liability, breach of warranty, and misrepresentation; (3) against the hospital IRB:  UTPCPL violations and intentional infliction of emotional distress.  Plaintiff may well assert other claims − these are just what was discussed in the Schiff set of opinions.

Third, and the whole point of this post, here is why we’re bothered by what’s been going on in Schiff.

From our perspective, it appears that these weird FDA/clinical investigation allegations have mesmerized the court, at least as far as the pleadings are concerned.  By that we mean that these allegations have induced a federal judge into permitting causes of action − for strict liability, for negligence, and under the UTPCPL − that have at best never been recognized under Pennsylvania law, and at worst are flatly rejected by controlling precedent.

It’s no isolated occasion. Precedentially unconstrained rulings typify the three Schiff opinions.

Let’s dispel the haze, shall we?

We will assume for purposes of this argument − although the Pennsylvania Supreme Court has never spoken on the subject − that under some circumstances, Pennsylvania would allow a negligence per se-type cause of action for at least some violations of the FDCA.

But not these.

Why?

Start with legal Propositions 1 and 2 − Pennsylvania recognizes no duty to test, and there exists no private FDCA cause of action.  A clinical trial, whether FDA approved or not, is simply a very formal a method of testing a product for safety and effectiveness.  Pennsylvania courts have said over and over again, that unless a product is otherwise defective, it doesn’t matter whether it was properly tested, or indeed tested at all.  If one assumes the rather fantastic allegations in Schiff that a surreptitious clinical trial of an experimental use was being conducted, that’s just an elaborate attack on the testing (or lack of same) of the product.

But plaintiff's argument that the purported clinical trial should have been conducted under FDA auspices is simply an claim that the defendants violated the FDCA.  As a private individual seeking damages, plaintiff simply can’t do that − not unless the claim resembles a recognized, pre-existing tort.  That’s been looked at over and over again in medical device preemption cases (we’re not arguing preemption here because it’s a class II device), and the lack of an FDCA private right of action restricts plaintiffs to FDCA-related claims that “parallel” state law.  We’ve done lots of posts on parallel claims, and most of our medical device preemption scorecard is devoted to what is or isn’t a “parallel” claim, so we won’t delve deeply into that here.

Since a duty to test doesn’t exist under Pennsylvania law, the FDCA violation claims in Schiff can’t possibly be parallel to any recognized Pennslyvania product liability claim.  The defendant manufacturer might have violated the FDCA from here to kingdom come (or at least to Israel, where it’s based) but that’s for the FDA to sort out.  As we’ve recently posted, private plaintiffs simply don’t have standing to raise FDCA violations that don’t also amount to traditional common-law claims − and the underground clinical trial allegations here aren't even in the vicinity.

So the FDCA regulatory haze in Schiff is just that − a smokescreen of basically irrelevant allegations that do nothing but confuse and obfuscate the plaintiff’s common-law causes of action − or lack of same.

One of those other causes of action would seem to be informed consent.  If, as plaintiff Schiff claims, she was not told the underlying medical risks and benefits of the surgery in question, then that would support a traditional informed consent action against the surgeon.  Moreover, if the procedure in question was really “experimental” − in the sense that its risks and benefits were unknown − then the law requires patients to be told this fact.  See Proposition 7.  However, as the Pennsylvania Supreme Court has pointed out “the doctrine of informed consent is a limited one.”  Valles, 805 A.2d at 1240 (quoting Duttry, 771 A.2d at 1258).  Informed consent obligations are owed only by doctors, not by hospitals, and certainly not by manufacturers.  See Proposition 6.  The learned intermediary rule, at the heart of most of the cases in Proposition 3, limits a manufacturer’s informational obligations to warning the treating physicians.  If those choose not to pass along information, that’s both their prerogative and their responsibility.

Thus, the apparent holding in Schiff III, 2012 WL 1971320, at *3, that some sort of “negligence” based warning claim (exactly what is never articulated) exists against the hospital IRB is simply contrary to Pennsylvania law governing the informed consent obligations of hospitals.  The only negligence theory (we'll put aside that "informed consent" in Pennsylvania sounds in battery, not negligence) that might even arguably exist to impose liability on a hospital for inadequate patient information would be under Friter, supra − that a hospital voluntarily agreeing to participate in an FDA-regulated clinical trial voluntarily assumes, and must perform reasonably, the informed consent obligations stated in FDA regulations.  But the allegations in Schiff are antithetical to any Friter-based cause of action, since plaintiff asserts that the defendants sought to circumvent FDA clinical trial regulations, not follow them.  Again, we’re left with a bare allegation that the hospital (and its IRB) should have complied with the FDCA, which must fail since it’s not “parallel” to any liability Pennsylvania law has ever recognized against a hospital.

Could there be a claim against the hospital in Schiff?  It’s hard to tell, and we don’t have a lot of experience in this area, but IRBs are supposed to supervise clinical trials.  To the extent plaintiff claims that she fell outside of the alleged study’s alleged protocol, well, at least compliance with protocol sounds like something that’s within the scope of an IRB’s supervisory duty.  So maybe.

The departures from established Pennsylvania law are even worse in Schiff II, with its holding that the alleged FDCA violations somehow provide an informational claim that can bypass the learned intermediary rule, see 2012 WL 1828035 at *6 (“defendant was negligent for failing to follow FDA regulations regarding investigative devices and failing to properly test the . . . device”).  We've already dealt with the non-existent "duty to test."  As for the rest, let’s be blunt.  Once a physician/patient relationship is in place, for forty years Pennsylvania has not recognized any exception to the learned intermediary rule, not for pharmacists, not for contraceptives, and certainly not for clinical trials.  Once again, there is no “parallel” direct-to-patient warning duty in Pennsylvania.  It’s a bare FDCA violation claim that the plaintiff in Schiff has no standing to pursue.

What could conceivably be pursued, buried beneath all the FDA-related dross in the Schiff complaint, is a claim that the manufacturer withheld information about safety and effectiveness (or the lack of data supporting same) from the prescribing surgeon.  That would state a claim under Pennsylvania law, but Schiff II wanders so far afield from anything recognizable as a Pennsylvania cause of action, that its hard to tell if a normal claim is even being alleged.  Also, the plaintiff in Schiff asserts a breach of contract claim, that the manufacturer agreed to pay for certain things, and then didn’t.  That could also be a viable claim, assuming the accuracy of the pleading (which is questionable).

Likewise, Schiff II purports to tease some sort of “strict liability” claim from the plaintiff’s FDCA-related allegations:

Plaintiff argues that, because the strict liability claim is based on more than a failure to warn theory, the claim is permitted to go forward.  Plaintiff argues that the “risk of thermal injury rendered the device unsafe, defective and dangerous as well as [defendant manufacturer’s] failure to consider the factors set forth in the FDA Guidance Document on RF medical devices” also permits for recovery for strict liability.  At the Motion to Dismiss phase, this Court finds that plaintiff has adequately pled a claim for strict liability.

2012 WL 1828035, at *5.  We've read this quote several times, and it’s still so vague and garbled that we can’t even figure out what kind of strict liability (design, warning, manufacturing?) is at issue.  Schiff II doesn't mention design.  It doesn't mention manufacturing.  But it nevertheless states that there's something "more than a failure to warn."  But the only thing mentioned aside from an inherent risk (which can only be warned about - see Viguers, supra, for the proposition that inherent risks aren't design defects), is the purported FDCA violation.

We do know this − Propositions 3 and 4.  Strict liability does not exist in Pennsylvania in the context of medical procedures involving prescription medical products.  That’s been the law, without exception (where the bar to strict liability has been asserted; we know a couple of cases where it wasn't) in Pennsylvania since Incollingo in 1971.  The absence of strict liability has been reaffirmed regularly by appellate courts applying Pennsylvania law.  Indeed, the most significant pending controversy in prescription medical product liability litigation in Pennsylvania is whether a negligence claim exists for design defect.  Even the very pro-plaintiff Lance decision (now before the Pennsylvania Supreme Court) agreed that no strict liability claim of any sort exists.  The fight in Lance is solely over negligence.

And then there’s fraud/UTPCPL.  As the abundant precedent cited in support of Proposition 5 holds, the Pennsylvania consumer fraud statute doesn’t apply to medical procedures of any sort or in product liability actions involving prescription medical products that physicians use in such procedures.  But in all three Schiff decisions allow novel UTPCPL or fraud causes of action to proceed against persons against whom that such claims have never before been allowed − and once again, the bizarre FDCA violation claims are at the heart of the allegations. In Schiff I:

Here, [plaintiff] avers that confusion and deceptive conduct surrounded the affiliation, connection, and association [defendant surgeon] had with the [defendant manufacturer] and the “BodyTite Procedure” as well as Plaintiff’s lack of knowledge of the clinical trial involving the Invasix device.  Furthermore . . . [the surgeon] allegedly failed to warn [plaintiff] of the potential dangers of the Invasix Device and, critically, allegedly misrepresented that the FDA approved, or was at least involved in the clinical trial, of the Invasix Device.

2012 WL 1355613, at *4 (emphasis added).  The “critical” UTPCPL allegations − indeed the only facts actually cited − all have to do with the purported non-FDA clinical trial.

In Schiff II, instead of the UTPCPL, plaintiff alleged, and the opinion allowed, a “misrepresentation” claim where “some of the alleged misrepresentations were made regarding the classification of the device.”  2012 WL 1828035, at *7.  There's the FDA again.  Once again, however, this claim is completely incompatible with controlling Pennsylvania law − our supreme court’s unanimous Southard decision cited in Proposition 7 above.  There the court held:

[T]he FDA labels given to a medical device do not speak directly to the medical issues surrounding a particular surgery. The category into which the FDA places the device for marketing and labeling purposes simply does not enlighten the patient as to the nature or seriousness of the proposed operation, the organs of the body involved, the disease sought to be cured, or the possible results.  The FDA administrative label does not constitute a material fact, risk, complication or alternative to a surgical procedure. It follows that a physician need not disclose a device’s FDA classification to the patient in order to ensure that the patient has been fully informed.

781 A.2d at 107 (emphasis added).

Not material....

Need not be disclosed to the patient....

It's safe to say that, as a matter of controlling Pennsylvania law, the supposed FDA “classification” of a regulated product “does not constitute a material risk” and “need not [be] disclose[d].”  It’s hard to get clearer than Southard that "misrepresentations . . . regarding the classification of the device" are immaterial and cannot possibly be the subject of any viable fraud claim, since such information doesn't have to be disclosed in the first place.

In Schiff III, once again, the UTPCPL allegations deemed most important are those involving the purported FDCA violations:

The Complaint further avers that [the IRB] engaged in unfair trade practices because the FDA had not given prior approval for [these] devices in . . . plastic surgery procedures.  These facts, in addition to others in the Complaint, are sufficient to state a claim for unfair trade practices and negligence.

2012 WL 1971320, at *4.

But yet these FDCA violation allegation have no analogy in any legal claim recognized in Pennsylvania, given Proposition 5 − that the UTPCPL simply doesn’t apply to medical providers.  Here, in a slightly different guise, we have the same bare FDCA regulatory violation (that private plaintiffs can’t pursue, Proposition 2) being passed off as something else, this time the violation of another statute.  Plaintiff can’t do that either − it’s been tried.  As the Third Circuit has held:

[Plaintiff’s] position would require us to usurp administrative agencies’ responsibility for interpreting and enforcing potentially ambiguous regulations.  Jurisdiction for the regulation of OTC drug marketing is vested jointly and exhaustively in the FDA and the FTC. . . . and what the FD & C Act and the FTC Act do not create directly, the Lanham Act [a federal statute] does not create indirectly.

Sandoz Pharmaceuticals, 902 F.2d at 231 (cited in Proposition 2).  In this respect, the UTPCPL as alleged in Schiff is no different than the Lanham Act claim alleged in Sandoz − both try to create forbidden private FDCA violation claims “indirectly” under cover of another statute.

So as we see it the FDCA-related allegations in the Schiff litigation about the purported surreptitious conduct of a clinical trial are both, (1) irrelevant, since there’s no FDCA-based cause of action paralleling any recognized claim under Pennsylvania law, and (2) immaterial, since the Pennsylvania Supreme Court has already held that FDA regulatory status is not information that need be disclosed to patients at all.

More fundamentally we believe that the repeated allowance of novel and often already-rejected supposed “Pennsylvania law” causes of action in Schiff needs to stop.  That’s Proposition 8.  Schiff is merely diversity-jurisdiction-based state-law litigation.  The Supreme Court and the Third Circuit have repeatedly and vehemently held that federal courts just cannot do what’s been going on in Schiff − allowing novel theories of liability that state courts have not recognized.
[A] federal court is not free to apply a different rule however desirable it may believe it to be, and even though it may think that the state Supreme Court may establish a different rule in some future litigation.

Hicks v. Feiock, 485 U.S. 624, 630 n.3 (1988).

A federal court in diversity is not free to engraft onto those state rules exceptions or modifications which may commend themselves to the federal court, but which have not commended themselves to the State in which the federal court sits.

Day & Zimmerman, 423 U.S. at 4 (1975).

 Unlike our role in interpreting federal law, we may not act as a judicial pioneer in a diversity case. 

Sheridan , 609 F.3d at 253.
As a federal court sitting in diversity, we are charged with predicting how another court – in this case, the [relevant state] Supreme Court – would rule on the record presented to us. . . .  [I]n reaching our conclusion we have exercised restraint in accordance with the well-established principle that “where two competing yet sensible interpretations” of state law exist, “we should opt for the interpretation that restricts liability, rather than expands it, until the Supreme Court of [the state] decides differently.”  To hold here, as [plaintiff] urges. . . would undoubtedly subject manufacturers and dealers to greater liability. . . .  Given the muddled state of [state] law on this point, we must decline [plaintiff’s] invitation.

Travelers Indemnity, 594 F.3d 238, 253 (3d Cir. 2010) (quoting Werwinski v. Ford Motor Co., 286 F.3d 661, 680 (3d Cir. 2002)).

[I]t is not the role of a federal court to expand state law in ways not foreshadowed by state precedent.  Instead, a federal court follows the precedents of the state’s highest court and predicts how that court would decide the issue presented.

City of Philadelphia v. Beretta U.S.A. Corp., 277 F.3d 415, 421 (3d Cir. 2002).

In a diversity case . . . federal courts may not engage in judicial activism. Federalism concerns require that we permit state courts to decide whether and to what extent they will expand state common law. . . . Our role is to apply the current law of the jurisdiction, and leave it undisturbed.

Leo v. Kerr-McGee Chemical Corp., 37 F.3d 96, 101 (3d Cir. 1994) (quoting City of Philadelphia v. Lead Industries Ass’n, 994 F.2d 112, 123 (3d Cir. 1993)).

At bottom, Schiff doesn’t strike us as that hard or complicated of a case.  There’s a question of whether the defendant adequately warned the prescribing surgeon of the risk (or perhaps of it's unknown nature) that the plaintiff encountered.  If not, did the surgeon already know the risk from his own clinical experience or elsewhere?   Did the surgeon adequately pass along the relevant risks to the plaintiff as part of his informed consent discussion?  If some sort of experimental surgery was involved, was plaintiff adequately informed by the surgeon that the relevant risks could not be accurately estimated on the basis of what was known?  And if there was some sort of protocol-based investigation going on (whether FDA-authorized or not), did the defendant surgeon follow the protocol and inform the patient that she was being enrolled in such a study − and did the defendant IRB adequately ensure that study protocols were being followed?  That’s it.  That sounds like what Schiff was (or should be) about.  The rest, all the regulatory brouhaha, is a smokescreen at best and an invitation to error at worst.  Right now, it unfortunately appears that the invitation is being accepted.  We hope that changes.

Friday, March 23, 2012

Pennsylvania Product Liability Law - The Muddle Continues

The Pennsylvania Supreme Court yesterday decided Beard v. Johnson & Johnson, Inc., No. 35 WAP 2010, slip op. (Pa. March 22, 2012), a decision that is good, bad, and ugly at the same time.  We say "ugly" because the entire decision - a discussion of strict "malfunction theory" liability in the context of a medical device, is based on a fundamental error (at least we'd say so) that was never brought to the court's attention.  That is, the Court in Hahn v. Richter, 543 Pa. 558, 673 A.2d 888 (1996), held that strict liability did not apply at all to any prescription drug, given the court's reading of Restatement §402A, comment k.  Subsequently, the Pennsylvania Superior Court (in accordance with the massive majority of cases nationwide) held that comment k would be applied in the same fashion to medical devices.  See Creazzo v. Medtronic, Inc., 903 A.2d 24 (Pa. Super. 2006).  Thus, Creazzo followed Hahn and held that strict liability simply does not apply to prescription medical devices.


But this foundational issue - whether a strict liability theory was even appropriate in a case involving a prescription medical product - was neither raised nor discussed, apparently at any level in Beard.  Why?  We don't know.


Next, the good parts of Beard.  The medical device in question, a really fancy stapler used for holding tissue together in complicated surgery where for one reason or another suturing is impossible or inappropriate, was designed for use in a variety of different surgical settings.  The plaintiffs (who had not preserved the device in question) claimed that risk-utility balancing concerning the design of the device should be conducted with blinders on - that the analysis should be limited to the particular use to which the device was put in the plaintiff's surgery.  The Court refused to limit the scope of risk-utility balancing in that fashion:



For better or worse, this Court’s decisions have relegated our trial courts in the unenviable position of “social philosopher” and “risk-utility economic analyst.”  This having been done -- and as the present case does not provide an appropriate opportunity for reconsideration of such assignment – we decline to require the trial courts to put on blinders. It should be enough to say that a product’s utility obviously may be enhanced by multi-functionality, so that it would be imprudent to deny trial courts the ability to assign some weight to this factor in assessing product design. . . . [Plaintiff’s] concessions of the net social utility calculus in the area of the [device’s] primary design [a different kind of surgery] are irreconcilably inconsistent with his claim of an inherent design defect. . . .


[T]here is much at stake in the condemnation of a product’s design, above and beyond any individual damages award or awards, including the impact on product costs and design innovation. On balance, we differ with [plaintiff's] position that the desire to streamline a particular facet of products litigation should be accorded priority over the wider-ranging assessment which was obviously intended from the outset, as manifested in the above characterizations of the trial court’s role, in the open-ended factors which have been accepted by Pennsylvania courts as the basis for risk-utility review, and otherwise.

Beard, slip op. at 24-24 (footnotes omitted).


After Beard, it is settled that, with respect to design defect claims in Pennsylvania, defendants will be able to defend by relying on the benefits of their designs in other uses of the product.  This should apply both to the Pennsylvania-peculiar judicial balancing of risks and benefits required under existing law (see Beard, slip op. at 25), and to the presentation of a risk/utility defense to the jury at trial.  See Phatak v. United Chair Co., 756 A.2d 690 (Pa. Super. 2000) (evidence bearing on same risk utility factors may be submitted to the jury in design defect cases).


This aspect of Beard can only help defendants by allowing them to compare their design to the plaintiff's alternative design across the entire spectrum of a product's intended uses.  Since the plaintiff's alternative design is usually tailormade to address only the accident in a given case, the alternative's adverse consequences to many other people who use the product will put before the jury the same broad perspective of product design that manufacturers necessarily employ in the real world.


The bad aspects of Beard are hinted at in the language we quoted above:  "the present case does not provide an appropriate opportunity for reconsideration of such assignment."  Yet again, the defense community has missed an opportunity to have the wide-open existential question that hovers over all Pennsylvania product liability law - the negligence-based Restatement Third theory, versus Pennslvania's idiosyncratic form of strict liability expressed by Azzarello v. Black Brothers Co., 480 Pa. 547, 391 A.2d 1020 (1978) - decided.


Justice Saylor, who wrote Beard, is (as he stated in the opinion, slip op. at 23)  one of "several justices" on record as supporting a shift away from Azzarello's extreme separation of "strict liability" from "negligence."  But as yet "a majority consensus has not yet been attained in any case."  Slip op. at 23.  The three justices who first advocated the change, "Saylor, J., joined by Castille, J. and Eakin, J.," id., aren't getting any younger.  Since Justice Saylor wrote Beard, he was careful to avoid anything that would undercut the Third Circuit's prediction (which we discussed here) that the Court would eventually move to the Third Restatement.  See slip op. at 23 (mentioning Third Circuit prediction in Covell v. Bell Sports, Inc., 651 F.3d 357 (3d Cir. 2011), and "[r]ecogniz[ing] the continuing state of disrepair in the arena of Pennsylvania strict-liability design defect law").  The Beard opinion also mentions the Third Restatement favorably in a footnote.  Id. at 26 n.18.


A three-justice concurrence (Baer, McCafferty, Todd, JJ.) dissaociates itself with footnote 18, also pointing out the unfortunate truth that, “[defendants] failed to raise this [Third Restatement] issue  in their Pa .R.A.P. 1925(b) statement of errors complained of on appeal.”  Id. at 2.  These three justices steadfastly “express no opinion on the merits of the adoption of the Restatement Third.”  Id.  Significantly, however, none of these justices comments adversely on the Third Circuit's continuing prediction in Covell of an eventual change.


However, another chance to get rid of Pennsylvania's archaic and extremely pro-plaintiff strict liability has gone by the boards.  While reading tea leaves is never easy, the fact that only three justices chose to disassociate themselves from Justice Saylor's pro-Third Restatement comments in Beard suggests that there could well be a four-justice majority on the current court to jettison Azzarello in a case where this issue is preserved.  Every defendant adversely affected by Azzarello should take care to preserve this issue from the outset.  Express preservation at the trial court level is required.  See Schmidt v. Boardman, 608 Pa. 327, 353, 11 A.3d 924, 940 (2011).

Tuesday, July 12, 2011

Third Circuit Reaffirms Berrier - Third Restatement Applies in Pennsylvania Federal Court

We've discussed the so-called "Berrier question" - whether the Third Circuit's prediction that Pennsylvania law would switch to the Third Restatement from the old Azzarello form of super-strict liability should continue to apply - before.  Our position is that stare decisis required application of Berrier, until the Pennsylvania Supreme Court said otherwise, and that for federal district courts to take it upon themselves to decide whether or not to follow the Third Circuit risked judicial chaos.

Anyway, we're pleased to announce that the question has been put to rest, at least on the Third Circuit end.  Today, in Covel v. Bell Sports, Inc., No. 10-3860, slip op. (3d Cir. July 12, 2011), holding that Berrier remained good law and that all federal district courts have to follow it.  The issue arose in Covell in the context of industry standards evidence, previously inadmissible under Azarello super-strict liability.  Under the Berrier/Third Restatement regime, however, this evidence is properly admitted.  Covell, slip op. at 14-15.

The same result should apply with all the other looniness of Azzarello-based Pennsylvania strict liability, from the "any element" charge, to regulatory compliance, to (dare we say it?) comparative fault.  Under the Third Restatement, the playing field becomes leveled.

The chief argument that the plaintiff raised was that the dismissal of the appeal in Bugosh v. I.U. North America, Inc., 971 A.2d 1228 (Pa. 2009), somehow invalidated Berrier, since Berrier made its prediction with the expectation that Bugosh would soon settle the issue.  However, under Pennsylvania law, a dismissal of an appeal has no precedential value whatever.  Commonwealth v. Tilghman, 673 A.2d 898, 904 (Pa. 1996).  The court refused to engage in what it called "[r]eading the tea leaves of a certiorari dismissal."   Slip op. at 14.

Given that Bugosh is of no consequence, we conclude that the state of the law in Pennsylvania is exactly as it was when we decided Berrier.  Absent a change in Pennsylvania’s law, we see no reason to upset our precedent.  Applying Berrier, we hold that the District Court did not err in using the Restatement (Third) of Torts to guide its decisions to admit evidence, and to frame its jury instructions.
Covell, slip op. at 14-15.

So there you have it.  Until the Supreme Court of Pennsylvania rules otherwise the Third Restatement "reasonableness"-based form of strict liability is considered Pennsylvania law in federal courts applying Pennsylvania law.  As defense lawyers (who argued for the Third Restatement in both Bugosh and Berrier), this makes us happy.  On the whole, the Third Restatement is much more friendly to defendants than Azzarello super-strict liability.

Now, if we can just get the Pennsylvania Supreme Court to address the issue.