We do not devote a lot of space to statute of limitations cases. That is not because they are unimportant. To the contrary, statutes of limitations serve fundamental principles of fairness and predictability. Parties should not have to worry about litigations springing up well after the operative events occurred, and well after witnesses, or their memories, have departed. But statutes of limitations are inherently fact- and jurisdiction-specific. Thus, it is not always easy to tease some principle of general applicability and interest out of those cases.
But you just know that we’re about to tease such a principle out of a statute of limitations case, don’t you? In most tardily-filed cases, we are greeted by an assertion that the discovery rule should come to the rescue because the defendant hid the truth, polluted the information environment, and prevented the plaintiff from filing earlier – that is, within the statute of limitations. That argument is almost always unadulterated hogwash. A federal judge in California recently did a thorough and elegant job of demolishing that argument. We could not resist sharing it with you.
In Plumlee v. Pfizer, Inc., 2014 U.S. Dist. LEXIS 121634 (N.D. Cal. August 29, 2014), the plaintiff brought a class action alleging that Zoloft did not work for her, and she wanted her money back. That’s only a slight oversimplification of the case. Various California statutes – the usual suspects -- were invoked. This case, to our cynical noses, smells like an effort to concoct a no-injury class action that would do more good for the attorneys than the litigants. No matter. It was filed too late. The plaintiff last purchased Zoloft or its generic equivalent in June 2008. She filed her class action lawsuit on January 30, 2013, which is four years and seven months after her claims accrued. The longest applicable statute of limitations was four years. The math is simple, and the math means that all of her claims are time barred.
How to get around that pesky statute of limitations? The plaintiff said that she did not discovery the defendant’s alleged misrepresentations and omissions regarding Zoloft’s efficacy until on or about May 22, 2012, when she watched a60 Minutes segment regarding the placebo effect and depression. Before that, the plaintiff dwelled in ignorance, as she “did not see any media, journal articles, press releases, websites, letters, or statements concerning Zoloft and its ability to outperform placebo in treating depression.” Plumlee, 2014 U.S. Dist. LEXIS 121634 at *11. The problem for the plaintiff is that the delayed discovery rule benefits only plaintiffs who can show that they acted reasonably and diligently in preserving their rights. The court had dismissed the original complaint in this case, but granted leave to amend, insisting that the plaintiff show her diligence. Did she manage to do that? She did not.
When a plaintiff attempts to enlist the discovery rule to elude the statute of limitations, the burden is on the plaintiff to show diligence. Conclusory allegations will not withstand a motion to dismiss. Plaintiffs are charged with presumptive knowledge of an injury if they have information of circumstances to put them “on inquiry or if they have the opportunity to obtain knowledge from sources open to their supervision.” Id. at *22. The plaintiff raised four arguments to explain her late discovery: (1) there is no affirmative duty to investigate under the delayed discovery rule; (2) she had no obligation to seek out publicly available information regarding Zoloft’s effectiveness; (3) such information was unavailable at the time; and (4) her subjective belief excuses her lack of diligence. Like most hitters on our beloved Phillies team this year, the plaintiff went 0 for 4.
The court bought precisely zero of plaintiff's arguments, and for good reason. The plaintiff “gave up” taking Zoloft and its generic equivalent in June 2008 because she “did not believe Zoloft was helping her depression.” Id. at *24. What did the plaintiff do to figure out why Zoloft was ineffective in treating her depression between June 2008 and when she saw the 60 Minutes segment in May 2012? Nothing. The plaintiff apparently did not consult her physician or psychiatrist about why the Zoloft was not helping her, nor did she look for any information regarding Zoloft’s effectiveness. The plaintiff said that she saw no information between March 2008 and May 2012 criticizing Zoloft’s efficacy, and that “[u]pon information and belief, no media or information criticizing Zoloft’s efficacy existed during this time period to which a reasonably diligent consumer would have been exposed.” Id.
After too many years of seeing the discovery rule invoked in too many cases, we’ve come to believe that in the plaintiff lawyer’s view of the world, only three things can inform someone of a potential claim, thereby starting the statute of limitations clock: (1) a 60 Minutes story; (2) an admission of liability by a company; or, most reliably and authoritatively of all, (3) a lawyer advertisement hawking the latest mass tort. But the law does not share this crabbed and crazy world view. The threshold issue is “whether the plaintiff acted diligently to investigate whatever information was available to her when she suffered her injury.” The plaintiff was not required to have all the facts underlying her specific legal theories served up to her on a platter. Once she knew Zoloft was ineffective for her, she could not “wait for [the facts] to find [her] and sit on [her] rights,” rather she had to “go find” the available facts. Id. at *25.
Predictably, the plaintiff argued that the defendant’s alleged misrepresentations and concealment of negative clinical trial data excuse her lack of diligence. The Plumlee court skewered this argument, pointing out that “[m]isrepresentations are a part of every fraud cause of action; nonetheless, the duty to investigate raises if the circumstances indicate that the defendant’s representations may have been false.” Id. at *26. According to her own allegations, the plaintiff had actual notice of Zoloft’s ineffectiveness, at least with regards to her own depression as of June 2008. With actual knowledge of Zoloft’s advertisements, drug label, and ineffectiveness in treating her depression after three years, the plaintiff had “reason to at least to suspect a factual basis” for her claims that the Zoloft advertising and label were misleading. Id. at *29.
In any event, there was no reason to accept at face value the plaintiff’s statement that “no media or information criticizing Zoloft’s efficacy existed during this time period to which a reasonably diligent consumer would have been exposed.” The defendant submitted dozens of publically available documents and articles, which were judicially noticed by the court, showing that a reasonably diligent consumer could have discovered information regarding the placebo effect, Zoloft’s effectiveness, and unpublished clinical trials. These articles came from such hidden and obscure sources as USA Today, Wall Street Journal, and the New York Review of Books. (Okay, that last one can be pretty obscure.) The defendant also demonstrated that eight of the scientific articles regarding the placebo effect of antidepressants, including Zoloft, that the plaintiff referenced in her amended complaint are available free of charge on the Internet. Id.(By the way, would you mind if we injected just a slight dose of reality into this topic? Since Al Gore invented the internet, it is simply and literally incredible for someone to claim that he or she did not hear or read about something related to some injury or medical condition. Nowadays, people open Google ASAP if they feel gas pains or espy a hint of toenail fungus.)
It would be convenient for plaintiffs if they could seize advantage of the discovery rule based only on their own (alleged) subjective belief as to when the action accrued. Such a belief is bulletproof. Every plaintiff could pretend ignorance and thereby turn the statute of limitations into a dead letter. If a plaintiff believes it is time to file a lawsuit, then it is.
Fortunately, the law is a tad more objective and rigorous. If a person becomes aware of facts that would make a reasonably prudent person suspicious, “he or she has a duty to investigate further and is charged with knowledge of matters which would have been revealed by such an investigation.” Id. at *32. In Plumlee, the plaintiff had a factual basis to suspect her injury and a corresponding duty to investigate. Had the plaintiff “taken any minimal step toward investigating her injury, she would have discovered the abundant publicly available information.” The plaintiff’s decision to “rely on her own subjective belief and forego taking any minimal step toward investigating her injury places her beyond the reach of the delayed discover rule.” Id.
The court’s patience was exhausted. This time, just in time, not a moment too soon, the dismissal was with prejudice.