United States: Another Reason Why Medical Device Class Actions Don't Work

Last Updated: August 26 2016
Article by Steven Boranian

The Ninth Circuit filed a preemption opinion the other day that should help prevent the "foodification" of medical device litigation. That made-up word refers to the wasteful food-related class action litigation that has somewhat thrived in California.  The template is familiar:  Opportunistic plaintiffs' lawyers find some aspect of food labeling that they claim is misleading—e.g., that a product is "wholesome" or "natural"—and they recruit a plaintiff to say that he or she would not have purchased the food or would have paid less for it had truth been told.  We wrote more than two years ago about a class action claiming that Hershey chocolates made misleading "healthy diet claims."  Who would possibly rely on "healthy diet claims" for chocolate treats?  That class action obviously had no legs, but others have gotten by.

Attempts to extend this business model to medical devices have failed, and one reason is federal preemption. That is our takeaway from DeBons v. Globus Medical, Inc., No. 14-5645, 2016 WL 4363171 (9th Cir. Aug. 16, 2016), where the Ninth Circuit affirmed the district court's order dismissing a putative class action involving bone putty, an allograft tissue product that the FDA regulates as a medical device. See the district court's dismissal order, DeBons v. Globus Medical, Inc., No. 2:13-cv-08518, 2014 WL 12495351 (C.D. Cal. Aug. 8, 2014).  Taking a page from the food playbook, the plaintiff claimed that the device was "not in fact FDA approved," which we take to mean that product was "cleared" through the 510k process rather than formally "approved."  He alleged therefore that "had made it known that the product was not FDA approved," he would not have paid for it. Id. at *1.  He asserted a raft of consumer fraud claims, including a claim under California's broadly written Unfair Competition Law, and purported to represent a class of other bone putty patients. Id. Bear in mind that the plaintiff alleged no surgical complication; the device evidently worked just fine.  This was strictly a play for a price refund.

Here is where it gets interesting. The main reason why medical device class actions are so rare these days is that medical treatment unavoidably presents individualized issues, making class treatment impossible.  Another reason is Section 337(a) of the FDCA, which gives the FDA exclusive authority to enforce the Act's provisions.  This provision impliedly preempts any private action right of action filed because a device manufacturer's conduct allegedly violates the FDCA. See Buckman Co. v. Plaintiffs' Legal Comm., 531 U.S. 341 (2001).  When combined with the Medical Device Amendments' express preemption provision, would-be plaintiffs face the "narrow gap" between implied preemption and express preemption on which we often comment (such as here). On the one hand, the MDA's express preemption provision bars states from enforcing requirements "different from or in addition to" federal requirements.  21 U.S.C. § 360k(a).  On the other hand, private litigants cannot enforce the FDCA.  A plaintiff therefore "must be suing for conduct that violates the FDCA (or else his claim is expressly preempted . . . ), but the plaintiff must not be suing because the conduct violates the FDCA (such a claim would be impliedly preempted under Buckman)." DeBons, 2016 WL 43463171, at *1 (quoting Perez v. Nidek Co., Ltd., 711 F.3d 1109, 1120 (9th Cir. 2013)).

Food law is a little different. Section 337(a) should create implied preemption in food cases too, for example in cases claiming that food labeling is misleading.  After all, the FDA regulates food labeling in great detail, and federal law should preempt any private right of action to enforce those requirements.  But the FDCA's express preemption provision for food is slightly different from the Medical Device Amendment's express preemption provision.  It prohibits states from imposing requirements that are not "identical" to an applicable food labeling standard [21 U.S.C. § 343-1(a)], which has been construed as an exception to the FDA's prosecutorial exclusivity.  An example is the California Supreme Court's opinion in In re Farm Raised Salmon, 175 P.3d 1170 (Cal. 2008) (which we wrote about here), where the Court held that Section 343-1 authorized states to enact food labeling laws "identical to" federal law and also permit the private enforcement of those laws.  Although we disagree with its reasoning, the California Supreme Court concluded that the legislature had done just that, thus avoiding implied preemption of claims alleging that salmon labeling was misleading. Id. at 1178-79.

There is no such "exception" to preemption for medical devices. On this point, the district court's order dismissing DeBons v. Globus and the Ninth Circuit opinion affirming the dismissal properly resisted the plaintiff's invitation to "foodify" medical device litigation.  As in food cases, the plaintiff tried to evade implied preemption by invoking California's consumer laws and arguing that some of his claims "would exist independent of the FDCA" as a matter of state law.  2014 WL 12495351, at *3.  But the district court saw through that argument and concluded that "fundamentally, these claims are still premised entirely on the FDCA." Id. The plaintiff therefore could not avoid preemption by placing a "state law" label on claims that were "fundamentally" meant to enforce the FDCA.  As the district court stated:

If Plaintiff's argument was accepted, the doctrine of implied preemption under 21 U.S.C. § 337(a) and Buckman would be almost entirely eliminated and private citizens would in effect be permitted to enforce the FDCA's requirements.  Such a reading is at odds with § 337, which provides that all proceedings to enforce the FDCA "shall be by and in the name of the United States."

Id. at *4. It is difficult to argue with this reasoning.  Moreover, the Ninth Circuit agreed and affirmed the dismissal, with only one exception:  The plaintiff alleged a breach of contract based on an alleged "contractual representation" by the company that the product was "FDA approved" or had been determined to be "safe and effective."  2016 WL 4363171, at *1.  Because such a contract would be a self-imposed undertaking, and not a state-imposed obligation, federal law would not preempt a breach of contract claim. Id. The plaintiff, however, could not identify any facts supporting a contract, despite four opportunities to amend his complaint.  The Ninth Circuit therefore affirmed the dismissal of the contact claim too, but on different grounds.   Id.

This is a welcome result, and we regret only that the Ninth Circuit opinion is unpublished.  If courts are going to allow food class actions, it is worthwhile to understand that medical devices operate in a different universe, where courts ought to hold the line.

This article is presented for informational purposes only and is not intended to constitute legal advice.

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