Product Liability Update
April 2019In This Issue:
Foley Hoag LLP publishes this quarterly Update primarily concerning developments in
product liability and related law from federal and state courts applicable to Massachusetts,
but also featuring selected developments for New York and New Jersey.
MASSACHUSETTS
First Circuit Holds Subsequent FDA Approval Of Drugs For Pediatric
Use Not Conclusive Proof Of Effectiveness At Time Of Sale So As To
Preclude Fraudulent Marketing Claims, And Individualized Proof Of
Causation Of Prescriptions And Drugs’ Ineffectiveness Not Required
Where Claims Supported By Medical Literature And Expert Testimony
In Painters & Allied Trades Dist. Council 82 Health Care Fund v. Forest Pharms.,
Inc., 915 F.3d 1 (1st Cir. 2019), numerous individual purchasers and third-party
payors sued multiple antidepressant manufacturers in the United States District
Court for the District of Massachusetts in a putative class action, alleging they
misrepresented the drugs’ efficacy in marketing them for the non-FDA-approved
or “off label” use of treating depression in multiple pediatric age groups, causing
physicians to prescribe and plaintiffs to pay for ineffective drugs. Plaintiffs
sought refund of the drugs’ full price through claims under the federal Racketeer
Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962, for harm
caused by “a pattern of racketeering activity” that included violation of the federal
mail and wire fraud statutes, 18 U.S.C. §§ 1341 and 1343, the Minnesota Unfair
Trade Practices Act, which prohibits deceptive commercial acts, and the similar
Minnesota Consumer Fraud Act, which forbids misrepresentation to consumers.
The district court granted summary judgment, holding the RICO claims lacked
evidence of injury and the state law claims were derivative of the RICO claims.
On appeal by one consumer and health care fund each, the United States Court
of Appeals for the First Circuit reversed. The court first rejected defendants’
argument, which was not addressed by the trial court, that subsequent FDA
approval of the off-label uses was dispositive proof the drugs were effective for
those purposes and hence plaintiffs were not harmed regardless of any marketing
inaccuracy. For one thing, while defendants relied on precedent that precluded
recovery of the price paid for medical devices that were FDA-approved, even
where plaintiffs alleged fraud on the FDA caused that approval, the devices at
issue there were in fact approved at the time of plaintiffs’ purchase, while the off-
label uses at issue here were not. Further, even if subsequent approval were
conclusive proof of effectiveness, the approvals here did not cover all the drugs or
age groups at issue. The court did note that, although not dispositive, evidence of
subsequent FDA approval was relevant and could be introduced at trial.
MASSACHUSETTS
◼ First Circuit Holds Subsequent FDA Approval
Of Drugs For Pediatric Use Not Conclusive
Proof Of Effectiveness At Time Of Sale So
As To Preclude Fraudulent Marketing Claims,
And Individualized Proof Of Causation Of
Prescriptions And Drugs’ Ineffectiveness Not
Required Where Claims Supported By Medical
Literature And Expert Testimony
◼ First Circuit Holds Due Process Permits Personal
Jurisdiction Over Foreign Manufacturer Selling
In Massachusetts Through Out-of-State National
Distributor, Concluding Acceptance Of Customers’
Orders And Requirement That Distributor Provide
Defendant’s Direct Contact Information Supported
Finding Defendant Purposefully Availed Itself Of
Privilege Of Conducting Activities In State
◼ Massachusetts Federal Court Holds (1) Related
Corporations’ Use of Common Website And
Conclusory Deposition Testimony That Entities
Were Not Separate Did Not Demonstrate
Pervasive Control Needed To Pierce Corporate
Veil, (2) Expert Testimony Regarding Design
Defect Created Triable Issue On Implied Warranty
Of Merchantability, And (3) Whether Literature
Representations Were “Puffery” Or Were Relied
Upon Created Triable Issues On Misrepresentation
◼ Massachusetts Supreme Judicial Court Holds
Statute Of Repose For Tort Claims Arising Out Of
Deciencies Or Neglect In Improvements to Real
Property Applies Even If Claim Involves Disease
with Extended Latency Period
◼ Massachusetts Federal Court Holds
Pharmaceutical Failure-To-Warn Claims Not
Preempted, As Manufacturer’s Literature And
Adverse Event Disclosures To FDA Could Be
Found Inadequate, Permitting Manufacturer
Unilaterally To Add Pregnancy Warning And
Rendering FDA Rejection Of Warning Not
Conclusive Proof Agency Would Have Rejected
Warning With Full Disclosure
NEW YORK/NEW JERSEY SUPPLEMENT
◼ Second Circuit Holds Pharmaceutical Failure-to-
Warn Claims Preempted Where Plaintiffs Did Not
Sufciently Allege Newly Acquired Information
Permitting Manufacturers To Change Warnings
Without FDA Approval, And Joinder Of In-State
Defendant Did Not Prevent Removal To Federal
Court Where Defendant Had Not Been Served As
Of Time Of Removal l
