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FDA Issues Prevent Remand in Spine Case

By James M. Beck and Mark Herrmann

A lot of generalities or stereotypes in law, as in life, turn out to be wrong when it matters most. The Brazilian soccer team got out-flamboyanted by the Dutch. The most emotionally deep and riveting movie out right now is for kids, Toy Story 3. The Phillies are pitching better than they're hitting (not that they are very good at either in this Summer of discontent).

Or think of jury selection. Anyone who has tried more than a few cases has encountered a couple of jurors who played completely against type, whatever the type was. (Yes, we know at least a couple of jury consultants out there who will tell us that we simply misread the jurors, and that they would have figured it out. And they're probably right.)

Another generality is that we expect corporate defendants to prefer federal courts (where cases are assigned to one life-tenured judge for all purposes, with broader jury pools, and where TwIqbal and Daubert reign) and plaintiffs prefer state courts (elected judges, pliable rules, even more pliable jurors). So we were a bit surprised when we read a case where the plaintiff and key defendants lined up in favor of preserving federal jurisdiction while a later-added defendant sought to remand a case to state court.

The claim in Reider-Gordon v. Synthes Spine Co., et al., 2010 WL 2569058 (C.D. Cal. June 22, 2010), is strange. Plaintiff had an artificial cervical disk (called "ProDisc") inserted, even though it had not yet been approved by the FDA, because he read that it had gone through rigorous testing, including by the doctor he eventually selected to be his orthopedic surgeon. The plaintiff (who seems to have been unusually proactive and diligent) read claims by that surgeon that "ProDisc had been found to result in significantly better outcomes than alternative treatments." Reider-Gordon, 2010 WL 2569058, *1. Plaintiff believed that "the studies were legitimate, independent studies performed by disinterested physicians." Id. What Plaintiff didn't know was that the surgeon had a financial interest in the company.

Unfortunately, the operation didn't go well and Plaintiff filed a lawsuit in state court under a variety of theories, including fraud, negligence, strict liability, breach of warranty, and conspiracy. We said the claim is strange, but it's actually reminiscent. We blogged about a similar case here. In that case the plaintiff sued some of the same entrepreneurs in this case, but they weren't the plaintiff's treating doctor, as was the case here.

Anyway, and completely consistent with all the instruction books, the defendants removed the case to federal court. Plaintiff later added the surgeon as a defendant, who promptly moved to remand the case to state court because both he and Plaintiff were California residents. There was no real issue of fraudulent joinder, so, indeed, diversity jurisdiction fails. But the original defendants argued that there was federal question juridiction because resolution of the state claims required the court to interpret FDA regulations. Interestingly, Plaintiff took the same position: "Plaintiff's claims are predicated on the premarket approval process and clinical trial procedures governed exclusively under FDA regulations." Reider-Gordon, 2010 WL 2569058, *4. Well, faced with such refreshing harmony, how could the court disagree? It didn't -- though it was a closer call than it needed to be.

The court did not think it necessary to interpret federal law in analyzing the claims for fraud or negligence. But it couldn't figure a way out of the strict liability claim without traipsing through federal law. After all, Plaintiff alleged that (1) ProDisc "was not manufactured and labeled as approved by by the FDA;" (2) Defendants "circumvented the Pre-Marketing approval process set out by the FDA;" and (3) "providing financial incentives to physicians performing the testing and evaluation is a direct violation of the FDA approval process or in the alternative a violation of the implied purpose of the FDA Pre-Market Approval process." Reider-Gordon, 2010 WL 2569058, *6. In other words, Plaintiff made it easy by explicitly including FDA regulations in the strict liability claim. But the fact is that it will pretty hard to decide the other claims without analyzing FDA regulations. In fact, we'd go so far as to say that those claims might end up being ... you know what we're about to say, don't you? We're utterly predictable, aren't we? Hold that thought.

As far as it goes, this ruling is fairly straightforward and hasn't exactly been lighting up the blogosphere. But we think there are four interesting things about this opinion:

1. We are curious as to why the plaintiff wanted to stay in federal court. That's it. We don't know why and would love to hear anyone's speculation. (We're too tired to speculate after last night's Independence Day celebration. You know, the, uh, fireworks.)

2. For those defendants battling to stay in federal court and fend off remand, the court's federal question analysis is useful, especially how plaintiffs cannot avoid the federal question via "artful pleading," when "a plaintiff attempts to avoid federal jurisdiction by omitting from the complaint 'federal law essential to his claim, or by casting in state law terms a claim that can be made only under federal law.'" Reider-Gordon, 2010 WL 2569058, *5 (quoting Olguin v. Inspiration Consol. Copper Co., 740 F.2d 1468, 1472 (9th Cir, 1984)). This exception to the well-pleaded complaint rule also applies if federal law completely ? it's coming, isn't it?

3. The gravamen of the plaintiff's claim is that she didn't know that her doctor had a financial interest in the product while he was involved in the clinical trials. Okay, we get how that might matter. But what if the clinical trials were run appropriately? What if the data and methodology were a-okay? Disclosure of interest is required in all sorts of situations -- including peer-reviewed publication -- but is its failure necessarily tortious?

4. In discussing the federal question, the court cited Buckman and Medtronic. First, in holding that the fraud claim doesn't necessarily require a federal question, the court says that "Plaintiff's right of relief ? may come from a determination that Defendants defrauded Plaintiff by failing to disclose to her certain information to induce her to undergo ProDisc-C implementation." Reider-Gordon, 2010 WL 2569058, *5. The court immediately follows that observation with a cf to Buckman. A cf?! Isn't the issue what was disclosed to the FDA? Second, the court says that the defendants might have negligently manufactured and labeled the ProDisc, but that "a finding that they violated FDA regulation is not a necessary element of their neligence claim." Id., citing Medtronic, Inc. v. Lohr, 518 U.S. 470, 503 (1996).

We'll see. The Reider-Gordon court kept nibbling around the edges of preemption throughout the opinion. Now that the case is safely esconced in federal court, we've got to believe that there will a healthy tussle over the scope of preemption. Sure, there will be the usual "parallel requirements" issue, but this case reeks of preemption and we expect to hear more from it. It will probably go up to the Ninth Circuit and then -- okay, we'll remember what we said about avoiding generalities or stereotypes.

Full post as published by Drug and Device Law on July 05, 2010 (boomark / email).