The West Virginia Supreme Court of Appeals has reversed an order granting the plaintiff’s partial summary judgment motion in a case involving alleged false and misleading communications by a drug maker to health care providers, finding that the lower court erred in giving preclusive effect to Food and Drug Administration (FDA) warning letters. W. Va. ex rel. McGraw v. Johnson & Johnson, No. 35500 (W. Va., decided November 18, 2010). The state attorney general sued the drug maker and its parent for communications provided to state health care providers about two drugs, alleging that the information was false and misleading.

FDA had previously warned the company that these communications either failed to disclose material information about new product-label warnings as to potential risks or made false or misleading claims about abuse potential. The company disputed FDA’s assertions, and after corrective letters were prepared to FDA’s satisfaction, the matters were closed. The attorney general’s allegations were based on the same company statements and omissions cited in FDA’s warning letters. A West Virginia trial court found, on the basis of FDA’s determinations, that the company had, as a matter of law, made false and misleading statements in violation of state consumer protection law and entered a civil penalty of $4.475 million against it.

On appeal, the state high court rejected the trial court’s conclusion that FDA had issued an official determination about the matter. According to the court, warning letters are not quasi-judicial determinations by the agency and, as such, “are not subject to collateral estoppel under West Virginia law.” The court characterized the letters as “informal and advisory notifications” expressing FDA’s “belief” that the company’s communications violated federal law. The company had no opportunity to challenge and fully litigate the merits of the FDA letters, because they did not constitute final action of the FDA commissioner. The court remanded the case so the parties could litigate whether the company’s statements or omissions in fact violated the law.