Sure, it was enjoyable to read In re DePuy Orthopaedics, Inc., Pinnacle Hip Implant Product Liability Litigation, ___ F.3d ___, 2018 WL 1954759 (5th Cir. April 25, 2018) (“Pinnacle Hip”), to see plaintiffs’ counsel hoisted on their own petard of improper and prejudicial evidence and arguments. But there’s more to Pinnacle Hip than “Lanier-on-a-spit,” as it has been described in these parts. Indeed, blogging plaintiffs’ attorney Max Kennerly, dropped a comment to our first Pinnacle Hip post (which we published – we scrub only spam, not opposing views) asserting that “the rest of the opinion was a huge win for plaintiffs.”
We largely disagree with Max’s comment, and this post explains why.
Initially, we note that the defendant in Pinnacle Hip was swimming decidedly upstream in all of its legal arguments, since it was opposing a jury verdict entered against it and seeking entry of judgment as a matter of law in its favor. 2018 WL 1954759, at *2. That means all the trial evidence is construed in the plaintiffs’ favor. Id. at *3 (“JMOL is warranted only if a reasonable jury would not have a legally sufficient evidentiary basis to find for the nonmovant.”) (citations and quotation marks omitted).
The first claim addressed in Pinnacle Hip was design defect. See 2018 WL 1954759, at *3-9. The defendant raised several arguments, all unsuccessfully. First, the defendant argued that plaintiff had failed to satisfy the Texas alternative design requirement because that alternative that the plaintiffs offered – a “metal on plastic” (“MoP”) hip implant – was really a “different product” from the defendants’ metal-on-metal design (“MoM”), and thus cannot serve as a design alternative. This is an argument we have featured several times on the blog. In Pinnacle Hip, the conclusion was that “based on the record, that MoP is a viable alternative design to MoM.” Id. at *4.
While we would have liked to win this, on the facts, this distinction between alternative product and design is more difficult for the defense than in the cases we’ve discussed in our prior posts, which usually involve not using the product at all, or using some other product that is much less suited for the use in question. Our classic example of alternative cause abuse is Theriot v. Danek Medical, Inc., 168 F.3d 253 (5th Cir. 1999), a Bone Screw case in which the supposed “alternative” was a different type of surgery not using the product at all. That’s distinct from redesigning one part of a device system to use a different material, as indeed, Pinnacle Hip pointed out. 2018 WL 1954759, at *9. Pinnacle Hip reaffirmed that similar-use products that “fail to perform the discrete kinds of functions for which the alleged defective was designed” or with a “wide disparity in price” cannot be considered alternative designs. Id. at *4, *7. However , the risk/utility defect test “contemplates that a proposed alternative design might reduce a product’s utility . . . without rendering the alternative an entirely different product.” Id. at *5. That means some variation has to exist without “moot[ing] the entire defect test.” Id.
Construing the record to favor plaintiffs, Pinnacle Hip resulted in another point on the uncertain, “practically impossible to settle in the abstract,” id., at *4, line between different design and different product. While we’d like to have won, Pinnacle Hip does not move the line itself in any lasting fashion prejudicial to the defense. The ultimate holding was that a “cross-linked” MoP is not sufficiently different from the defendant’s MoP design to be considered a different product. 2018 WL 1954759, at *6 & n.13. The underlying principle that the distinction between product and design seeks to protect is preventing automatic liability against whole classes of products – cigarettes, motorcycles, birth control pills, or pedicle screw fixation devices – for simply being what they are and having certain inherent risks. That principle remains intact after Pinnacle Hip.
The defendants also lost a preemption argument – that design defect claims “’stand as an obstacle to the accomplishment and execution of the full purposes and objectives’ reflected in the MoM-related regulations of the FDA.” 2018 WL 1954759, at *7. According to the defendants, because the plaintiffs were seeking “categorical” liability, that all MoMs should be “banned outright,” there should be preemption. Id. at *8. But that’s not what the Fifth Circuit found was what happened:
[I]t is not the case that plaintiffs’ theory reached all possible MoMs. All would agree that, despite the sweeping language with which plaintiffs presented their case, their claims were impliedly limited to presently available technologies and the adverse health effects they allegedly engender.
Id. But the record showed that “[t]he FDA effectively withdrew all MoMs from the market . . . and left open a single door in the form of PMA.” Id. On this set of facts, it could not be said that banning something that the FDA had already essentially removed from the market, save for an alternative that has not yet produced an FDA-approved product, was an interference with “the FDA’s regulatory objectives.” Id.
While losing a preemption argument is not something we would recommend, this particular type of preemption argument has never been successful that we are aware of, so it’s no great loss. We’ve advocated at some length that the Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996), decision be overturned. But that argument is predicated on changes to 510(k) clearance created by Congress in 1990. In Pinnacle Hip, “MoMs were sold before 1976 and have traditionally been treated as pre-amendment class III devices.” 2018 WL 1954759, at *8. So Pinnacle Hip doesn’t affect even the distinctions that we draw from Lohr. The preemption argument rejected in Pinnacle Hip would require the complete reversal of Lohr, even on Lohr’s facts, to succeed.
By far the better preemption argument, based on current law, with respect to 510(k) design defect claims, is that they amount to “major changes” that require prior FDA review, and probably an entirely new supplemental submission, before they could be implemented. That should put design defect claims at odds with the “independence principle” in PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011), and Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472 (2013), resulting in preemption of all design claims that could make a difference in a product liability action. That argument, which does not depend on Lohr either way, was not addressed at all in Pinnacle Hip.
Finally, the defendants in Pinnacle Hip also lost on their Restatement (Second) of Torts §402A, comment k (1965), argument, which was that Texas law holds all prescription medical products, including medical devices, to be “unavoidably unsafe” within the meaning of comment k, so that those “unavoidable” risks can only be warned about and not treated as design defects. Pinnacle Hip was unwilling to expand Texas’ application of comment k from prescription drugs to include prescription medical devices. 2018 WL 1954759, at *9. That places Pinnacle Hip in a distinct minority position, since literally hundreds of cases, and the Third Restatement, apply limits on design defect claims equally to all types of prescription medical products. Bexis’ book collects these cases. Drug & Medical Device Product Liability Deskbook §2.02 at pp. 2.02-13 to -16 n.14 (for the proposition that “almost all courts have extended the unavoidably unsafe product exception to medical devices”). However, as the Fifth Circuit correctly pointed out, not many of those opinions are under Texas law.
The further discussion of case-by-case versus across-the-board comment k application in Texas, 2018 WL 1954759, at *9, is more troubling, as the trend in Texas courts (in drug and vaccine prescription product cases) has favored the “blanket” approach. Pinnacle Hip complained, in a footnote, that “Texas caselaw offers almost no guidance on how to go about that case-by-case inquiry.” Id. at *9 n.22. There is good reason for that lack of precedent – because Texas law has not employed tests that require such inquiry. See Reyes v. Wyeth Laboratories, 498 F.2d 1264, 1273 (5th Cir. 1974) (applying comment k without case-by-case analysis to a vaccine; holding that the only viable claim was inadequate warning); Gonzalez v. Bayer Healthcare Pharmaceuticals, Inc., 930 F. Supp.2d 808, 817-18 (S.D. Tex. 2013) (applying comment k to prescription drug without case-by-case analysis); Woodhouse v. Sanofi-Aventis United States LLC, 2011 WL 3666595, at *3-4 (W.D. Tex. June 23, 2011) (holding, without further analysis, that “comment k applies to products such as [defendant’s prescription drug]); Holland v. Hoffman-La Roche, Inc., 2007 WL 4042757, at *3 (N.D. Tex. Nov. 15, 2007) (“Prescription drugs are not susceptible to a design defect claim where, as here, the drug is ‘accompanied by proper directions and warning.’”) (quoting comment k); Carter v. Tap Pharmaceuticals, Inc., 2004 WL 2550593, at *2 (W.D. Tex. Nov. 2, 2004) (“Under Texas law, all FDA-approved prescription drugs are unavoidably unsafe as a matter of law”); Hackett v. G.D. Searle & Co., 246 F. Supp.2d 591, 595 (W.D. Tex. 2002) (“under Texas law and comment k of the Restatement, Defendants can only be held strictly liable if the drug was not properly prepared or marketed or accompanied by proper warnings”). Contra: Adams v. Boston Scientific Corp., 177 F. Supp.3d 959, 965 (S.D.W. Va. 2016) (refusing to apply comment k across-the-board in medical device case) (applying Texas law). The comment k portion of Pinnacle Hip is where we think that Max is on the firmest ground. The decision made Texas law worse. This issue will ultimately be won in Texas appellate courts or perhaps before the Texas legislature, where it would be quite simple to extend the warning related presumption of §82.007 to all medical devices approved or cleared by the FDA.
As to warning claims (which Texas law calls “marketing defects”), the defendants lost on adequacy as a matter of law. Pinnacle Hip, 2018 WL 1954759, at *10. Unfortunately, defendants usually lose on this ground, so it’s big news – and trumpeted on this blog – when a defendant wins a judicial holding that its warning is adequate as a matter of law. No surprise there. In Pinnacle Hip, that discussion ended:
Not until after the FDA issued its proposed rule in 2013 did defendants specifically warn about the metallosis, pseudotumors, and tissue necrosis − the sorts of conditions that plaintiffs maintained caused their revision surgery.
Id. at 11. As defense counsel, we interpret the Fifth Circuit’s observation as an invitation to seek an adequacy as a matter of law ruling as to post-2013 claims (if there are any) in the litigation.
In the causation discussion pertaining to the warning claims, Pinnacle Hip of course followed the learned intermediary rule. It discussed the role of “objective” evidence of causation:
At the threshold, the parties debate the relevance, under Texas law, of “objective evidence” − that is, evidence “that a different warning would have affected the decision of a reasonable doctor.” . . . Here, plaintiffs proffered objective evidence in [expert] testimony that, if the full risks of MoM were known to physicians, “they would run to [a different product].”
2018 WL 1954759, at *11 (citations omitted). As we’ve discussed before, “objective” expert testimony about what “reasonable physicians” would have done is usually disallowed in learned intermediary cases.
On this point, however, Fifth Circuit law, has not been as favorable as other courts. In Thomas v. Hoffman-LaRoche, Inc., 949 F.2d 806, 812 (5th Cir. 1992), the court actually allowed expert testimony on what a “reasonable” physician might have done – but that case was under Mississippi law. See Ackermann v. Wyeth Pharmaceuticals, Inc., 526 F.3d 203, 212 (5th Cir. 2008) (suggesting that Thomas would not apply to Texas law). We’ve been aware of the brief Texas Supreme Court passing reference to “objective” evidence in Centocor, Inc. v. Hamilton, 372 S.W.3d 140, 171 (Tex. 2012) (plaintiffs “presented no objective evidence”), but felt no reason to let the other side know it was there.
Now it’s been discovered, however. The Fifth Circuit allowed such evidence to be admissible, 2018 WL 1954759, at *12 (“objective evidence is at least relevant”), but did not find it decisive in situations where the plaintiff would otherwise have suffered dismissal. Critically, Pinnacle Hip did not allow unsupported “expert” testimony about what an objectively “reasonable physician” would have done be enough to let plaintiffs survive when they didn’t have prescriber testimony – which would have been the equivalent of allowing a heeding presumption in Texas, something the Fifth Circuit rejected outright in Ackerman, 526 F.3d at 212-13.
Relevance, however, does not imply sufficiency. In the [learned intermediary] context, causation entails two distinct factual predicates: first, that the doctor would have read or encountered the adequate warning; and second that the adequate warning would have altered his treatment decision for, or risk-related disclosures to, the patient. Centocor addressed only the latter, suggesting a jury might be allowed to presume a particular physician would respond “reasonably” to fuller disclosure. But that presumption must yield to contrary subjective testimony by the treating physician, and Centocor fails to explain how objective evidence would apply to whether that doctor would have read or encountered the warning in the first instance. When considered for the limited purpose intimated in Centocor, objective evidence would have little bearing on any of [these] plaintiffs’ claims.
Pinnacle Hip, 2018 WL 1954759, at *12 (footnotes omitted) (emphasis original). Thus, where the plaintiffs had no testimony from their prescribing physicians, those claims continue to fail, and some “expert” claiming otherwise cannot change the result. Id. (granting JMOL in no-prescriber testimony cases). Likewise, any “objective” testimony “must yield to contrary subjective testimony by the treating physician.” Id. So plaintiffs cannot create questions of fact with expert testimony where the prescriber has affirmatively testified that a different warning would not have changed what s/he did.
Only what the Fifth Circuit described as “mixed bag” prescriber testimony (the prescriber said different things in different parts of his testimony) cases got to the jury in Pinnacle Hip, id. at *13, and those have always been harder cases for the defense anyway. At best, for plaintiffs, paying some expert to opine that a “reasonable” physician would have heeded a warning won’t save any plaintiff who lacked a plausible warning causation case in the first place. At worst, Pinnacle Hip means more plaintiff-side noise at trial in cases already going to trial on warning causation. All in all, the defense side is better off after Pinnacle Hip than where it had been in the Fifth Circuit with only the Thomas precedent. We definitely don’t agree with Max here.
In Pinnacle Hip, the manufacturer’s parent corporation was held potentially liable because of the amount of guidance and control permitted by an inference from the facts (based on a “clear error” standard). 2018 WL 1954759, at *15. Those facts allowed the court to conclude that more than a “passive parent-subsidiary relationship” existed as to this product. Id. at *16. To us that’s “big whoop” for two reasons. First, the “clear error” standard does not apply at the district court level where jurisdictional motions are initially decided. Second, and more important going forward, the plaintiffs proceeded under a “stream of commerce” theory where the Fifth Circuit had previously “embraced [the] more expansive” (Brennan) side of the 4-4 split in Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102 (1987). Pinnacle Hip, 2018 WL 1954759, at *15. As we’ve discussed, that broad “stream of commerce” jurisdictional theory is probably toast after Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017). Pinnacle Hip did not even cite BMS in its discussion of personal jurisdiction, so we guess that this argument wasn’t raised. In light of the BMS precedent, the Pinnacle Hip jurisdictional holding should be treated as something of a “one-off” applicable to this MDL, but not to future litigation where BMS will stand front and center.
Pinnacle Hip includes the Fifth Circuit’s full-throated reaffirmance of our favorite Erie principle:
[T]hat debate [about what a Texas court might do] is beside the point. When sitting in diversity, a federal court exceeds the bounds of its legitimacy in fashioning novel causes of action not yet recognized by the state courts. Here, despite ample warning, the district court exceeded its circumscribed institutional role and expanded Texas law beyond its presently existing boundary.
2018 WL 1954759, at *17 (footnote, citations, and quotation marks omitted) (emphasis added). The court therefore threw out the spurious invention of an “aiding and abetting” cause of action that had no reasonable predicate in Texas law. Id.
The court did allow two arguably weird theories against the parent corporation – all product liability theories imposing liability against a non-manufacturing parent under a theory not also cognizable against the manufacturing subsidiary are likely to be weird − to survive. One of those, so-called “nonmanufacturer seller” was tied to statutory exceptions to immunity for nonmanufacturers. Id. at*18. The court held, instead, that the parent was only held liable for old-fashioned design or warning liability, after the record (again, construed in favor of plaintiffs as verdict winners) established one of statutory exceptions from nonmanufacturer immunity. Id. That’s a little peculiar to non-Texas lawyers, but since Texas has this statute, it must mean something.
The other oddball claim that survived is one of those “last refuge of a scoundrel” theories, negligent undertaking” (a/k/a “Good Samaritan”) liability.
Texas caselaw reveals no precise control threshold a parent must cross before undertaking a duty to its subsidiary’s customers. Texas courts have made clear that mere possession of “the authority to compel” a subsidiary is not enough − the parent “must actually” exercise that authority in a manner relevant to the undertaking inquiry.
Pinnacle Hip, 2018 WL 1954759, at *19 (footnote omitted). Based on the stringent standard for interpreting record evidence, the court let this one slide. Id. Not good, but not likely to arise very often.
But there’s more afoot than just these three theories. Two years ago, we awarded In re DePuy Orthopaedics, Inc., 2016 WL 6268090 (N.D. Tex. Jan. 5, 2016), our ranking as the number six worst decision of that year, chiefly because of the large number of unprecedented theories under Texas law that this opinion permitted:
(1) extending negligent misrepresentation beyond “business transactions” to product liability, unprecedented in Texas; (2) ignoring multiple US Supreme Court decisions that express and implied preemption operate independently (as discussed here) to dismiss implied preemption with nothing more than a cite to the Medtronic v. Lohr express preemption decision; (3) inventing some sort of state-law tort to second-guess the defendant following one FDA marketing approach (§510k clearance) over another (pre-market approval), unprecedented anywhere; (4) holding that the learned intermediary rule does not apply whenever a defendant “compensates” or “incentivizes” physicians to use its products, absent any Texas state or appellate authority; (5) imposing strict liability on an entity not in the product’s chain of sale, contrary to Texas statute (§82.001(2)); (6) creating a claim for “tortious interference” with the physician-patient relationship, again utterly unprecedented; (7) creating “vicarious” breach of fiduciary duty for engaging doctors to serve as expert witnesses in mass tort litigation also involving their patients, ditto; and (8) construing a consulting agreement with a physician as “commercial bribery” to avoid the Texas cap on punitive damages, jaw-droppingly unprecedented.
While only item (5) was at issue in Pinnacle Hip, the Fifth Circuit’s invocation of Erie conservatism bears ill for all of the other judicial flights of fancy that have been allowed during the course of the Pinnacle Hip litigation.
Constitutionality of Punitive Damages Cap
For completeness, plaintiffs also lost their constitutional challenge to the Texas statute capping punitive damages at twice compensatory damages. “Plaintiffs’ cross-appeal is meritless, and we dispose of it by footnote.” Pinnacle Hip, 2018 WL 1954759, at *1 n.4. That footnote went further, and characterized those constitutional claims as “frivolous.” Id. at *23 n.72. No matter what the constitutional challenge, a punitive damages cap “need only survive rational-basis review,” which it did in Pinnacle Hip “by injecting predictability into exemplary damages awards and preempting potentially unconstitutional awards.” Id. (citations omitted).
When all is said and done, we view Max’s characterization of Pinnacle Hip as a “huge win for plaintiffs” as mostly overblown hyperbole, perhaps worthy of inclusion in the closing arguments that the Fifth Circuit held warranted a new trial. The Fifth Circuit did some damage to comment k, but all the rest of the legal holdings were trivial, fact-bound, not likely to be useful in future cases, or some combination of those. The forceful reiteration of conservative principles of Erie predictions of state law leave us hopeful that the Pinnacle Hip MDL will see some Fifth Circuit-mandated clean up – or, if not, perhaps the appellate court’s not-so-veiled Parthian, parting shot may have to be fired in earnest:
[D]efendants, despite their serious critiques of the district judge’s actions in this case and related MDL proceedings, see In re DePuy Orthopaedics, Inc., 870 F.3d 345, 351 (5th Cir. 2017) (finding “grave error”), have not asked us to require these cases to be reassigned to a different judge under “this court’s supervisory power to reassign,” United States v. Stanford, 883 F.3d 500, 516 (5th Cir. 2018). We express no view on the issue but note that reassignment is both “extraordinary” and “rarely invoked.” Id. (citation and internal quotation marks omitted).
Pinnacle Hip, 2018 WL 1954759, at *27, n.83. Obviously, the Fifth Circuit in Pinnacle Hip was uncomfortable with the prospect of overruling the JPMDL’s assignment of this MDL, but this final footnote stands as a clear warning that, if further provoked (such as by continuing consolidated trials, or resort to other prejudicial evidence that the court noted but did not rule on), it will consider doing so.