Product Liability Update - July 2015

Massachusetts Supreme Judicial Court Holds Failure-to-Warn Claim Against Drug Manufacturer Not Preempted Because There Was No "Clear Evidence" FDA Would Not Have Approved Plaintiffs' Suggested Warning; Also Holds Non-Physician's Causation Opinion Admissible and $63 Million Compensatory Award Not Excessive

In Reckis v. Johnson & Johnson, 471 Mass. 272 (2015), a seven-year-old developed the severe dermatologic disease toxic epidermal necrolysis (TEN) after her parents gave her multiple doses of over-the-counter ibuprofen even after the girl began developing a rash. The child's parents, for themselves and on her behalf, sued the drug's manufacturers in Massachusetts Superior Court for negligence, breach of the implied warranty of merchantability (the Massachusetts near-equivalent of strict liability) and violation of Mass. Gen. L. ch. 93A (the Massachusetts unfair and deceptive practices statute), alleging the drug caused the TEN and defendant did not adequately warn consumers that redness, rash or blisters could be signs of a "life-threatening" disease, either with or without specific mention of TEN. A jury awarded the child $50 million and the parents $13 million.

On defendants' appeal, the Massachusetts Supreme Judicial Court ("SJC") granted direct appellate review and affirmed. Regarding defendants' argument that plaintiffs' failure-to-warn claim was preempted by the Federal Food, Drug, and Cosmetic Act, the court noted that under the United States Supreme Court's decision in Wyeth v. Levine, 555 U.S. 555 (2009) (see May 2009 Foley Hoag Product Liability Update), the claim would be preempted only if there was "clear evidence" the United States Food and Drug Administration ("FDA") would not have approved the warnings for which plaintiffs contended. The FDA had previously rejected a citizens' petition requesting that labels for over-the-counter ibuprofen include a warning that redness, rash, or blisters could be a sign of TEN, Stevens-Johnson syndrome or other "life-threatening" diseases. In so doing, the agency specifically noted consumers were unfamiliar with the names of such diseases, but did not specifically address the possibility of referring to "life-threatening" illness in general. Based on this record, and the fact that the rejected warning, including its "life-threatening" language, had been proposed by a citizens group rather than an ibuprofen manufacturer, the SJC held there was clear evidence FDA would have rejected plaintiffs' disease-specific warning but not as to a more general "life-threatening" illness warning. The court also concluded the jury's verdict was likely based on the non-preempted theory, as the jury must have disbelieved the father's testimony that a TEN-specific warning would have caused him not to administer the drug, and in his closing plaintiffs' counsel had explicitly stated plaintiffs did not contend the warning should have mentioned TEN.

The court also rejected defendants' challenge to the opinions of plaintiff's non-physician pharmacologist/toxicologist both that ibuprofen can cause TEN in humans generally and that the doses administered by plaintiffs after their daughter's rash appeared had caused her disease. The court found the expert sufficiently qualified by training and experience to opine to the effects of drugs in humans generally. Moreover, as several witnesses and at least one published study agreed TEN was less severe the sooner drug administration was stopped, this supported, in the court's view, the reverse proposition that the daughter's TEN would never have developed had the drug been stopped at the first sign of a rash.

Finally, the SJC affirmed the compensatory damages awards. Regarding the daughter's award, defendants argued plaintiffs had failed to provide any expert or other evidence of what her future medical expenses and/or lost future earning capacity would be, and the jury had been instructed they could consider these damages categories along with pain and suffering. Since defendant had not requested a verdict form itemizing the damages, however, it was impossible for the court to assess whether the jury had awarded unsupported amounts for the challenged categories, and the court noted that the child had undergone at least twelve surgical procedures, lost all functional vision in at least one eye and approximately half of her lung capacity. For the latter reasons, the court also upheld the parents' award. In both connections the court refused to consider defendants' arguments the awards were significantly out-of-scale compared to all known awards in Massachusetts history.

Massachusetts Federal Court Holds Biologics Manufacturer Has No Product Liability or Other Duty Under Various States' Laws to Sell Sufficient Product in FDA-Approved Dose to Meet Market Demand, and Bayh-Dole Act Governing Federally Funded Inventions Creates No Private Right of Action

In Hochendoner v. Genzyme Corporation, 2015 U.S. Dist. Lexis 37789 (D. Mass. March 25, 2015), defendant was the sole FDA-approved manufacturer of a biologic agent to treat Fabry disease, a genetic disorder inhibiting the ability of patients' cells to remove fats and leading to early death from conditions such as kidney disease, heart attack and stroke. Between 2009 and 2011, a series of incidents —including alleged viral contamination at defendant's production facility— severely reduced the agent's availability, leading defendant to ration supplies for existing patients at 30% to 50% of the FDArecommended dose and recommend that new patients not receive the drug.

Patients from 22 states brought a putative class action in the United States District Court for the Western District of Pennsylvania, alleging this caused a less effective treatment, allowing their disease to progress and symptoms to return. Plaintiffs asserted claims under various states' laws for negligence, breach of express and implied warranties, strict liability and violation of state consumer protection and product liability statutes. They also alleged defendant violated the federal Bayh-Dole Act, 35 U.S.C. §§ 200 et seq., through nonuse or unreasonable use of a publicly funded invention. After the case was transferred to the United States District Court for the District of Massachusetts, defendant moved to dismiss on the grounds that (1) as pleaded, plaintiffs' nebulous theories of injury failed to give defendant "fair notice of the plaintiffs' claims and the grounds upon which they rest," as required by Fed. R. Civ. P. 8, and (2) plaintiffs failed to state any claim upon which relief may be granted.

The court first found that plaintiffs satisfied Rule 8's pleading standards for only one of their three alleged injuries—that the lower dosage had a diminished effectiveness that allowed symptoms to return. Their theory of "accelerated deterioration" was too ambiguous to provide fair notice because it failed to differentiate between whether the lower dosage was less effective at preventing the harm caused by the disease or was itself inherently harmful. Plaintiffs' claim that foreign particulates injured them by further diminishing the drug's supply was also inadequate as there was no allegation the particulates themselves caused any direct injury, thus again falling short of fair notice.

In a matter of first impression, the court next analyzed whether the Bayh-Dole Act creates a private right of action for members of the public who use federally-funded inventions and concluded it does not. The court held the statute lacks language that would imply any "intent to confer rights on a particular class...