United States: North Carolina Rejects Stengel in Complete Preemption Win

Last Updated: May 31 2017
Article by Michelle Yeary

Put a New Yorker and a Californian in a room together and the debate will begin almost immediately. Hollywood v. Broadway. Atlantic v. Pacific. Dodgers v. Yankees or Giants v. Forty-Niners. Shake Shack v. In-N-Out (or is Five Guys overtaking both?). And more generally speaking that east coast/west coast divide extends beyond those two urban hubs. Laid back v. fast-paced lifestyle. Deserts v. low country. Golden Gate v. Sunshine Skyway. Disneyland v. Disney World. And let's not forget – the west coast may be synonymous with California sunshine, but the east coast gives you actual seasons.

While failure to report adverse event claims are not limited to the west coast, we think of them as Stengel claims. In case you need reminding, we believe that the Ninth Circuit made a historic error in Stengel v. Medtronic Inc., 704 F.3d 1224 (9th Cir., 2013) (en banc), when it equated routine product liability inadequate warning claims with indirect third-party warning claims where the third party is a governmental agency – that is, the FDA. Since Stengel is a Ninth Circuit case and the Ninth Circuit includes the entire west coast – we're going to saddle the west coast with that one. And we're going to praise an east coast court for saying, thanks but no thanks.

We've talked about Burrell v. Bayer Corporation before when earlier this year the court ruled that allegations of parallel claims in plaintiff's complaint conferred federal question jurisdiction. After winning on removal, the defendants next moved to dismiss the entire case on preemption. Round 2 goes to defendants as well.

The product at issue is the Essure birth control medical device. It is a pre-market approved device so preemption shouldn't be a big surprise. Burrell v. Bayer Corp., 2017 WL 1955333, *1 (W.D.N.C. May 10, 2017). As is true of the vast majority of drug and medical device products cases, failure to warn is at the heart of the case. But as we already know, traditional failure to warn claims are preempted in PMA device cases. So, plaintiffs pushed for a Stengel-claim. Plaintiff's argument is failure to warn premised on failure to provide adverse event reports to the FDA is a non-preempted parallel claim. Unpersuaded by the reasoning of that west coast court, Burrell found that the requirement to report adverse events exists under the FDCA rather than state law and therefore, plaintiff's failure to warn claim is "being brought because the [] defendants allegedly failed to meet these reporting requirements." Burrell, at *5 (emphasis added). And where a claim is being brought solely based on a violation of the FDCA – that's Buckman implied preemption. Traditional failure to warn is expressly preempted, failure to report to the FDA is impliedly preempted. Score one for the east coast for getting this.

But the court didn't stop there. Analyzing the claim under state law, it still didn't hold up because plaintiff's allegations didn't support a finding of causation. This is where most Stengel claims. By the time the device was implanted in plaintiff, the FDA had received and analyzed the adverse event reports and the subsequent warning did not contain any new information. Id. at *5 (although a black box warning was required, that was a new "type" of warning, the substance of the warning was unchanged). So there was no causal nexus between the alleged failure to report and plaintiff's injury.

None of plaintiff's remaining claims fared any better. On failure to train, the claim only survives preemption if premised on allegations that defendant failed to train in accordance with federal requirements. Plaintiff made no such allegations. Id. at *6. Moreover, plaintiff again failed to allege any facts to support a causal connection between the failure to train and her injury. Id. Plaintiff's negligent manufacturing claim suffered the same fate – no alleged violation of federal requirements and no facts to support causation. Id. Plaintiff's design defect claim was dismissed as expressly preempted. As a PMA device, the "FDA made its determination of this products safety and effectiveness for its given use. As the plaintiff cannot allege that [defendant] departed from its FDA-approved design of this product, these design defect claims are preempted." Id. at *7. Even if not preempted, North Carolina does not recognize strict liability claims for products liability. Id.

            Moving on to warranty claims, plaintiff alleged that defendant expressly warranted the product was safe. To find that defendant breached that warranty, a jury would have to conclude that the product was unsafe – which is contrary to the FDA's conclusion in its pre-market approval that the device was in fact safe and effective. So, express warranty is expressly preempted. Id. Since plaintiff's implied warranty claim also turned on whether the product was reasonably safe, it too was expressly preempted. "The FDA, under the FDCA and the MDA, has the express authority to make such determinations as to the safety and effectiveness of Class III medical devices." Id.

Plaintiff's final claims against the manufacturer were for fraud and unfair trade practices. The court first noted that most of the allegations on these claims were just a re-packaging of the allegations pleaded with plaintiff's other claims. Since the allege misrepresentations were largely "indistinguishable from FDA-approved labeling statements" – they too were preempted. Id. at *8.

Nice job North Carolina. In the east coast v. west coast debate, we'll side with an anti-Stengel jurisdiction every time.

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

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