In what's a bit of a mixed bag decision, the ultimate takeaway from Bird v. Globus Medical, Inc., 2020 WL 5366300 (E.D. Calif. Sep. 8, 2020) is that the complaint was generally lacking. So, plaintiff is going to get a second chance. Meanwhile, we can take a look at just what wasn't up to par on the first go-round.
Plaintiff underwent surgery on her cervical spine (neck) during which her surgeon implanted a device allegedly manufactured by defendant. The device received 510k clearance from the FDA. Approximately seven years after the surgery, plaintiff learned that the device had moved out of position, "causing danger of paralysis and death." Id. at *1. Plaintiff sued the manufacturer for fraud by concealment, negligence per se, and failure to warn. Before getting to the merits of defendant's motion to dismiss, the court agreed to take judicial notice of documents pulled directly from the FDA's public website. Id. The court was unwilling to take judicial notice, at plaintiff's request, of a device brochure because plaintiff failed to provide adequate information about the document's origins. Id. at *2.
Defendant's first ground for dismissal was that plaintiff failed to allege any present injury. As of the filing of the complaint, plaintiff was only alleging a risk of serious injury, but nothing had happened yet. Based on this fear of future injury, plaintiff alleged she suffered "physical and mental pain and suffering" and had incurred medical bills and related expenses. Id. at *3. As to the part of plaintiff's claim for emotional distress, that claim requires "more likely than not" proof that the feared injury will occur and that is corroborated by expert evidence. Id. Plaintiff did not adequately plead her emotional distress claim and it was dismissed.
Defendant argued that the economic loss rule barred plaintiff's economic damages claim due to a lack of present injury. The economic loss rule prohibits a tort recovery for purely economic damages unless those damages are accompanied by "some form of physical harm." Id. Relying on state court precedent, the court ruled that where plaintiff's fraud claim was based on "misrepresentations that risked physical harm to persons," the economic loss did not apply. Id. The same, however, is not true for plaintiff's negligence-based claims. To avoid the economic loss rule for those claims, plaintiff has to plead, absent a common law exception, either a personal injury, physical damage to property, or a special relationship between the parties. Since she pleaded none of those, the court dismissed her negligence per se and failure to warn claims without prejudice. Id.
Defendant also argued that plaintiff's claims should be dismissed as preempted because they exist solely by virtue of the FDCA. Id. at *4. From the opinion it appears plaintiff is making off-label promotion allegations. While not explicitly set forth in the decision, it appears plaintiff's claims are focused on the fact that the device was cleared for use in the spine somewhere other then in the cervical region. So, plaintiff's fraud claims are premised on the alleged non-disclosure of the scope of the 510k clearance and her negligence claims are based on allegedly illegal off-label promotion. Id.
Here, the court looked to Ninth Circuit precedent. First there is Perez v. Nidek, 711 F.3d 1109, 119-20 (9th Cir. 2013) which held that fraud claims based on the "non-disclosure to patients of facts tied to the scope of [FDA] approval," are preempted as private attempts to enforce the FDCA. We cover that topic here. Then came McClellan v. I-Flow Corp., 776 F.3d 1035, 1040 (9th Cir. 2015), which we covered here. There, plaintiff alleged that defendant failed to warn that the device should not be put to an off-label use. The Ninth Circuit said the claim was not preempted because the allegations were "outside the context of the regulatory process." Id. at 1041. We bet you can figure out which decision we think got it right.
In any event, the Bird court decided plaintiff's failure to warn claim was more like McClellan and her fraud claim more like Perez, but then decided neither was preempted. Plaintiff's failure to warn that the device was not safe for use in the cervical spine could exist outside the regulatory context. Bird at *5. And plaintiff's fraud claim wasn't only about the scope of approval. Plaintiff also alleged that defendant "created the false impression" that the device "was properly cleared for use by the FDA." So, plaintiff isn't only alleging that defendant's promotion was off-label but also that it was false which is a basis for liability under California law. Id.
On negligence per se, the court held the claim survived preemption because it was premised on a violation of a state duty under the California Health and Safety Code that paralleled the duties imposed by federal law. Id.
Having survived preemption, the court ultimately held that plaintiff's fraud claim was inadequately pleaded under the heightened standard of Rule 9
While perhaps sufficient to suggest "how" defendant may have committed fraud by concealment and "what" was concealed, the complaint does not provide defendant with notice of "who…when, [and] where.
Id. at *6. So, the claim was dismissed without prejudice. Finally, the learned intermediary rule precludes any failure to warn claim premised on a duty to warn the patient directly. Id.
If you tally things up – plaintiff's emotional distress claim was dismissed. As to economic damages, only her fraud claim survived. Then that claim was dismissed for insufficient pleading. On the whole, there is really nothing left – except plaintiff's second chance. We'll have to wait to see what she makes of it.
Originally published by Reed Smith, September 2020
This article is presented for informational purposes only and is not intended to constitute legal advice.