Nichols v. Covidien LP

DONALD NICHOLS, Plaintiff, v. COVIDIEN LP, et al., Defendants.

Case No. 20-cv-06836-EMC

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

February 26, 2021

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS

Docket No. 27

Plaintiff is Mr. Donald Nichols, a former patient at Saint Joseph Hospital in Eureka, California who received surgical treatment for rectal cancer. Mr. Nichols alleges that the medical stapler which was used during his surgery was defective, and he sues the entities responsible for the manufacture and distribution of that stapler. Mr. Nichols has filed a Second Amended Complaint alleging three causes of action: (1) strict products liability for a manufacturing defect, (2) common law negligence, and (3) strict products liability under a failure to warn theory. Docket No. 23. Mr. Nichols seeks medical and incidental expenses, loss of earnings and/or earning capacity, and general damages. Defendants move to dismiss under Rule 12(b)(6). Docket No. 27.

I. BACKGROUND

A. Factual Allegations in the Complaint

In the SAC, Mr. Nichols alleges as follows. Defendant Medtronic, Inc. is a medical device sales company which sells its products throughout California, including to St. Joseph Hospital. SAC ¶ 10. Covidien LLC is a wholly owned subsidiary of Medtronic, Inc. and also maintains a large sales operation for its products throughout California. Id. ¶¶ 11-12. Covidien and Medtronic (collectively, "Defendants") are individually, jointly, and severally liable for damages which Mr. Nichols suffered as a result of Defendants' design, manufacturing, marketing, labeling, distribution, sale, and placement of the Covidien products at issue in this suit. Id. ¶ 16.¹

Defendants design, manufacture, and sell End to End Anastomosis Staplers ("EEA staplers"), which are devices used by medical service providers in surgical procedures. Id. ¶ 20. EEA staplers enable surgeons to create a secure anastomosis (i.e., a connection between two internal bodily structures) within the body and form a seal. Id. The stapler used during Mr. Nichols's surgery (and identified in hospital billing records) is called an Endo GIA stapler. Id.

Mr. Nichols was admitted to St. Joseph Hospital in Eureka, California on September 28, 2018 for treatment of rectal cancer. Id. ¶ 22. He underwent a low anterior resection, and the surgeon (Dr. Thomas J. Rydz) used an Endo GIA stapler to create an anastomosis. Id. ¶ 23. Even though Dr. Rydz used the stapler properly during the procedure, the stapler misfired repeatedly. Id. ¶¶ 23, 27. Mr. Nichols alleges that Dr. Rydz noted the malfunction in a post-surgery report, writing "we had significant problems with the stapler device used at the time of surgery. There were some misfirings of the stapler..." Id. ¶ 23. See also Kaufman Declaration, Ex. 1 (highlighted portions on the official Discharge Report noting that a few days after the surgery, Mr. Nichols suffered from an "anastomotic leak and peritonitis") (Docket No. 29-1).

1. Alleged Manufacturing Defects: Sled Components and Pin Components

Mr. Nichols alleges that the misfirings occurred because the Endo GIA stapler was missing a "sled component," a part of the device which helps ensure staple deployment. Id. ¶ 24. Staplers lacking sled components will not reliably deploy staples, and this can result in a failure to form a robust anastomosis (leading to bleeding or leakage of luminal contents). Id.

Next, Mr. Nichols alleges that the Endo GIA stapler that was used is missing one of two "pin components," which are designed to maintain alignment of the stapler device jaws. Id. ¶ 25. An Endo GIA stapler without a pin component may result in incomplete staple formation, which,in turn, leads to bleeding, anastomotic leaks, peritonitis, or pneumothorax. Id. Mr. Nichols alleges that the stapler which was used by Dr. Rydz suffered from both manufacturing defects, which resulted in the failure of the stapler to form a proper staple line. Id. ¶ 26.

As a result, in the days following the surgery, an anastomotic leak was discovered, which physicians attempted to repair and which required prolonged hospitalization for several weeks. Id. ¶¶ 27, 29-30. All told, Mr. Nichols remained in the hospital for nearly a month due to complications from the stapler malfunction and suffered significant scarring. Id. ¶ 31, 32.

Mr. Nichols alleges that Defendants were aware that the Endo GIA stapler used for Mr. Nichols' surgery frequently malfunctions and that it contains defects. Id. ¶¶ 33-34. The stapler used on Mr. Nichols has been the subject of a recall, and the FDA has proposed reclassifying it from a Class I device to a Class II device that one subject to Special Controls - this proposed reclassification meant that manufacturers such as Defendants had to publicly report all malfunctions or injuries related to the Endo GIA stapler. Id. ¶¶ 7, 35, 40.

2. Defendants' Alleged Concealment of Malfunctions via FDA's Reporting Scheme

The next component of Mr. Nichols's factual allegations involves the Manufacturer and User Facility Device Experience ("MAUDE") database, a publicly accessible database run by the Food & Drug Administration. Id. ¶ 4. While there are significant numbers of stapler-related incidents each year (including 412 reported deaths, nearly 12,000 reported severe injuries, and roughly 98,500 malfunctions between 2011 and 2018), the majority of Defendants' reports were submitted to the Alternative Summary Reporting (" ASR") Program, a non-public database which hides the nature and severity of stapler-related incidents from surgeons and the public.² Id. ¶¶ 4-5. The purpose of ASR is to allow for quarterly summary reports of well-known events in lieu of individual reports, but Defendants used the ASR system to keep the scope of injuries related tosurgical staplers hidden from surgeons and their patients. Id. ¶ 6.

Mr. Nichols alleges that Defendants misused the ASR Program to avoid reporting new and novel malfunctions of surgical staplers that cause severe injury, as these new malfunctions would have subjected the staplers to recall or reclassification. Id. ¶ 35. Defendants allegedly reported injuries under the term "malfunctions" to avoid public disclosure and to ensure that the FDA did not recall these devices or reclassify them into a higher risk category. Id. ¶¶ 36-37. This resulted in a vast disparity between the "hidden" database and the public MAUDE reporting system.

Despite the dangers of surgical staplers which caused FDA to consider reclassification from Class I to Class II, Defendants continued to market the Endo GIA staplers as safe and failed to include warnings regarding potential malfunctions (which were known to them by virtue of being reported in the ASR system). Id. ¶ 41. More specifically, Defendants intentionally failed to (1) provide warnings regarding the potential for surgical staplers to malfunction in the very manner which occurred during Mr. Nichols's surgery; (2) warn and inform surgeons of the potential for its staplers to malfunction in that manner; and (3) recall their defective products when Defendants knew they were prone to malfunction. Id. ¶ 42.

II. DISCUSSION

A. Motion to Dismiss

Federal Rule of Civil Procedure 8(a)(2) requires a complaint to include "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). A complaint that fails to meet this standard may be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6). See Fed. R. Civ. P. 12(b)(6). To overcome a Rule 12(b)(6) motion to dismiss after the Supreme Court's decisions in Ashcroft v. Iqbal, 556 U.S. 662 (2009), and Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), a plaintiff's "factual allegations [in the complaint] 'must . . . suggest that the claim has at least a plausible chance of success.'" Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th Cir. 2014). The court "accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving party." Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). But "allegations in a complaint . . . may not simply recite the elements of a cause of action [and] must contain sufficientallegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively." Levitt, 765 F.3d at 1135 (internal quotation marks omitted). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. "The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. (internal quotation marks omitted).

B. Strict Products Liability Manufacturing Defect

To state a claim under a strict liability theory for a manufacturing defect, Mr. Nichols must allege the following elements: "(1) he has been injured by the product; (2) the injury occurred because the product was defective; and (3) the defect existed when the product left the hands of the defendant." Tucker v. Wright Med. Tech., Inc., No. 11-cv-03086-YGR, 2013 U.S. Dist. LEXIS 38354, at *34 (N.D. Cal. Mar. 19, 2013); Wu v. EAN Holdings, LLC, No. 5:13-cv-00188-PSG, 2014 U.S. Dist. LEXIS 4010, at *3-5 (N.D. Cal. Jan. 10, 2014) (same).

A manufacturing defect exists where the product "is one that differs from the manufacturer's intended result or from other ostensibly identical units of the same product line." Barker v. Lull Eng'g Co., 20 Cal. 3d 413, 429, 143 Cal. Rptr. 225, 236, 573 P.2d 443, 454 (1978)). Cf. Carson v. Depuy Spine, Inc., 365 F. App'x 812, 814 (9th Cir. 2010) ("[t]o prove a negligent manufacturing claim under California law, a plaintiff must first show that the product as delivered departed from the governing specifications"). Thus, a manufacturing...