Bayer Corporation, et al., Appellants-Defendants, v. Rene Leach, et al., Appellees-Plaintiffs.
Court of Appeals Case No. 19A-CT-625
Court of Appeals of Indiana
August 19, 2020
Bailey, Judge.
Interlocutory Appeal from the Marion Superior Court; The Honorable James B. Osborn, Judge; Trial Court Cause No. 49D14-1803-CT-12218
ATTORNEYS FOR APPELLANTS
Robert A. Jorczak
Ice Miller LLP
Indianapolis, Indiana
Erika L. Maley
Christopher A. Eiswerth
Sidley Austin LLP
Washington, DC
ATTORNEYS FOR APPELLEES
Lee C. Christie
Katherine A. Franke
Cline Farrell Christie Lee & Bell, P.C.
Indianapolis, Indiana
Gregory J. Bubalo
Katherine A. Dunnington
Bubalo Law PLC
Louisville, Kentucky
[1] Rene Leach and more than thirty other women (collectively, the “Women“) claim that they were physically injured by a medical device called Essure, which was marketed as a form of permanent birth control. The Women sued Bayer Corporation and related entities—the alleged manufacturers of Essure. The nine-count complaint alleges liability under the Indiana Product Liability Act, the Uniform Commercial Code, and the Indiana Consumer Sales Act. Certain defendants (collectively, “Bayer“) moved for judgment on the pleadings, asserting that (1) the claims are preempted and (2) aspects of the complaint
[2] We affirm in part, reverse in part, and remand for further proceedings.
Discussion and Decision
Standard of Review
[3] A Trial Rule 12(C) motion “tests the sufficiency of a claim or defense presented in the pleadings[.]” KS&E Sports v. Runnels, 72 N.E.3d 892, 898 (Ind. 2017). “In reviewing a motion under 12(C), a court must ‘base [its] ruling solely on the pleadings’ and ‘accept as true the material facts alleged in the complaint.‘” Bayer Corp. v. Leach, 147 N.E.3d 313, 315 (Ind. 2020) (alteration in original) (quoting KS&E Sports, 72 N.E.3d at 898). “A court should grant the motion ‘only when it is clear from the face of the pleadings that the plaintiff cannot in any way succeed under the operative facts and allegations made therein.‘” Id. (quoting Noblesville Redev. Comm‘n v. Noblesville Assocs. Ltd. P‘shp, 674 N.E.2d 558, 562 (Ind. 1996)). “[W]e review a 12(C) ruling de novo.” KS&E Sports, 72 N.E.3d at 898.
Regulatory Background
[4] The Food and Drug Administration (the “FDA“) is a federal agency that enforces the Federal Food, Drug and Cosmetic Act (the “FDCA“), see
[5] To obtain PMA, a device manufacturer must submit a detailed application. See
[6] Notably, although PMA results in a series of federal requirements, the FDCA itself provides no mechanism for
Express Preemption
[7] One type of preemption is express preemption—where Congress has included “explicit preemptive text[.]” State v. Norfolk S. Ry. Co., 107 N.E.3d 468, 471 (Ind. 2018). When legislation contains such text, courts “do not invoke any presumption against pre-emption but instead ‘focus on the plain wording of the [text], which necessarily contains the best evidence of Congress’ pre-emptive intent.‘” Puerto Rico v. Franklin Cal. Tax-Free Tr., 136 S. Ct. 1938, 1946 (2016) (quoting Chamber of Commerce of U.S. v. Whiting, 563 U.S. 582, 594 (2011)); see also Norfolk S. Ry. Co., 107 N.E.3d at 474 (applying no presumption and concluding that a claim was expressly preempted based on the preemptive text).
[8] In the MDA, Congress included the following explicit preemptive text:
[N]o State or political subdivision of a State may establish or continue in effect with respect to a device intended for human use any requirement . . .
(1) which is different from, or in addition to, any requirement applicable under this chapter to the device, and
(2) which relates to the safety or effectiveness of the device or to any other matter included in a requirement applicable to the device under this chapter.
[9] For example, if the FDA requires monthly reporting and a state requires weekly reporting, the state law is unenforceable because it is expressly preempted. Cf. Riegel, 552 U.S. at 330 (noting that the explicit preemptive text precludes claims asserting a violation
[10] Thus, due to the explicit preemptive text in the MDA, federal law supplies all germane standards of care. A state may provide a cause of action. However, any viable state-law claim must be premised on the violation of federal law. Therefore, enforceable state requirements—i.e., standards of care—must parallel federal requirements. See Riegel, 552 U.S. at 330 (recognizing the viability of parallel claims); McGookin v. Guidant Corp., 942 N.E.2d 831, 838 (Ind. Ct. App. 2011) (“The MDA and Riegel could not be clearer that federal law broadly preempts any claim that would allow a jury to impose a standard of care different from or in addition to the FDA‘s specific federal requirements.“); Bausch v. Stryker Corp., 630 F.3d 546, 552 (7th Cir. 2010) (noting that where state and federal requirements are effectively the same, the state requirements are not expressly preempted).
Implied Preemption
[11] Even if a claim is not expressly preempted, however, the claim could be impliedly preempted. See Norfolk, 107 N.E.3d at 471. There are two types of implied preemption—field preemption and conflict preemption. Id.
Field Preemption
[12] Field preemption applies where Congress intended to exclusively occupy the field. Id. Here, the preemptive text leaves room for state-law claims premised on the violation of federal law. See
Conflict Preemption
[13] “Conflict preemption applies when it is ‘physically impossible’ to comply with both the state and federal laws” or “when state law does ‘major damage’ to the federal law‘s purpose.” KS&E Sports, 72 N.E.3d at 905 (quoting Kennedy Tank & Mfg. Co., Inc. v. Emmert Indus. Corp., 67 N.E.3d 1025, 1029 (Ind. 2017)). The existence of preemptive text does not bar the “ordinary working” of conflict preemption principles. Geier v. Am. Honda Motor Co., 529 U.S. 861, 869 (2000).
[14] In Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341 (2001), the United States Supreme Court considered whether principles of conflict preemption precluded claims that a device manufacturer defrauded the FDA. The Court examined congressional intent, looking to the statute specifying that proceedings to enforce the FDCA “shall be by and in the name of the United States.”
Indiana Product Liability Act
[16] Turning to the instant case, the Indiana Product Liability Act (“IPLA“) “governs all actions that are: (1) brought by a user or consumer; (2) against a manufacturer or seller; and (3) for physical harm caused by a product; regardless of the substantive legal theory or theories upon which the action is brought.”
[17] A medical device falls within the IPLA definition of a product. See
[18] We conclude that the IPLA applies. Therefore, the only viable product-liability claims in the complaint are those recognized by the IPLA. See
puts into the stream of commerce any product in a defective condition unreasonably dangerous to any user or consumer . . . for physical harm caused by
that product to the user or consumer . . . if: (1) that user or consumer is in the class of persons that the seller should reasonably foresee as being subject to the harm caused by the defective condition;
(2) the seller is engaged in the business of selling the product; and
(3) the product is expected to and does reach the user or consumer without substantial alteration in the condition in which the product is sold by the person sought to be held liable under [the IPLA].
[19] The IPLA establishes when a product is in a defective condition. Brewer v. PACCAR, Inc., 124 N.E.3d 616, 622 (Ind. 2019). Moreover, under the IPLA, there are only three ways a product can be in a defective condition: (1) if the product has a design defect, (2) if the product has a manufacturing defect, or (3) if the product has a defect because the manufacturer failed to give adequate information about the product, e.g., inadequate warnings or inadequate instructions. See
[20] “[I]n an action based on an alleged design defect in the product or based on an alleged failure to provide adequate warnings or instructions regarding the use of the product,” the plaintiff “must establish that the manufacturer or seller failed to exercise reasonable care under the circumstances in designing the product or in providing the warnings or instructions.”
Negligence Per Se
[21] Before addressing specific state-law claims under the IPLA, we note that the Women at times seek to import standards of care from the Indiana Uniform Food, Drug, and Cosmetic Act (“Indiana FDCA“), asserting liability under a theory of negligence per se. The Indiana FDCA imposes requirements on device manufacturers. See
Manufacturing Defect
[22] Indiana Code Section 34-20-4-1 provides the pertinent standard for whether a product is in a defective condition due to a manufacturing defect:
A product is in a defective condition . . . if, at the time [the product] is conveyed by the seller to another party, it is in a condition: (1) not contemplated by reasonable persons among
those considered expected users of the product; and (2) that will be unreasonably dangerous to the expected user or consumer when
used in reasonably expectable ways of handling or consumption.3
[23] In Count 1 and Count 7, the Women allege manufacturing defects.4 The Women specifically allege that Essure devices were “nonconforming products” in that they “failed to conform to the design and performance standards as described in the PMA and approved by the FDA.” Appellant‘s App. Vol. 3 at 137. The Women allege that Essure was “promoted, distributed, manufactured and used in a manner that is in violation of federal law, the FDCA, the MDA, and regulations promulgated thereunder[.]” Id. at 137-38. The Women also allege that Essure devices “were defective in manufacture because they did not comply with [Bayer‘s] own design specifications[.]” Id. at 199. As to design specifications, the Women assert that “[v]iolating the conditions of [PMA] is another way of saying that the manufacturer violated the original design of the product and therefore creates a viable manufacturing defect claim.” Id. at 198. The Women assert that approval “includes not only the physical components of
the product, but the labeling and intended use of the product as well,” and that violating a condition of PMA supports a manufacturing-defect claim. Id.
[24] In Count 1, the Women allege several violations of federal requirements: (1) making false or misleading statements in connection with Essure; (2) the failure to investigate and report adverse events; (3) the failure to submit a PMA supplement and proactively strengthen warnings on the Essure label; (4) the failure to report new clinical investigations and studies; (5) the failure to comply with quality control standards; (6) the failure to establish and maintain procedures for implementing corrective and preventive action; and (7) the failure to ensure that Essure was of merchantable quality. Moreover, the Women allege that they were injured “[a]s a direct and proximate result of [Bayer‘s] violations of one or more” of the federal requirements. Id. at 140.
[25] In Count 7, the Women focus on the assembly and construction of Essure, alleging that Bayer “used non-conforming material” and “deviated from otherwise identical units from the same product line, manufactured with the same specifications.” Id. at 199. The Women allege ten ways in which the construction or assembly of individual Essure devices was defective, e.g., that “the no lead solder could in fact have trace lead in it[.]” Id. at 198. The Women further allege that the defective Essure devices caused their injuries.
Adequacy of Pleading
[26] Bayer argues that the Women failed to adequately plead their manufacturing-defect claims. In so arguing,
[27] According to Bayer, the Women failed to adequately plead a manufacturing-defect claim because the Women made “only a cursory effort to describe the manufacturing defects . . . [w]ithout any allegations to suggest that specific federal violations caused an identifiable defect that led to a particular injury[.]” Br. of Appellant at 52. Bayer also contends that “the Women‘s failure to allege in more than [a] conclusory fashion that Bayer‘s actions caused [the Women‘s] injuries also renders the claim inadequately pled under Indiana law.” Id.
[28] Turning to the complaint, the Women alleged that Bayer violated federal requirements and that those violations caused their physical injuries. The Women cited specific federal regulations that they claim Bayer violated. See id. at 138-39. The Women also provided a list of ten alleged defects related to the assembly or construction of individual devices. Further, the Women alleged—plaintiff-by-plaintiff—specific physical injuries. See, e.g., id. at 88 (noting that one plaintiff‘s “post-procedure course has been marked by menorrhagia, extreme fatigue, abdominal pain, back pain, joint pain, and various skin rashes.“). Moreover, the Women alleged that the purported “defects . . . were a foreseeable and substantial contributing cause of the injuries and damages . . . that would not have occurred but for” using Essure. Id. at 140.
[29] Having reviewed the matter, we conclude that Bayer has adequate notice of the manufacturing-defect claims under Indiana‘s liberal standard. See KS&E Sports, 72 N.E.3d at 901; cf. Bausch, 630 F.3d at 558 (noting that “courts must keep in mind that much of the product-specific information about manufacturing needed to investigate a [manufacturing-defect] claim fully is kept confidential by federal law” and “[f]ormal discovery is necessary before a plaintiff can fairly be expected to provide a detailed statement of the specific bases for her claim“).
Express Preemption
[30] As earlier discussed, a claim based on a failure to comply with a federal requirement is not expressly preempted. See
Strengthening Warnings
[31] In general, before a manufacturer may make a change “affecting the safety or effectiveness” of an approved device, the manufacturer “shall submit a PMA supplement for review and approval[.]”
[32] Of course, even if a device manufacturer declines to proactively make changes to the labeling, the manufacturer is subject to ongoing reporting requirements. See
[33] Throughout the complaint, the Women attempt to premise liability on Bayer‘s continued use of the approved Essure label. Indeed, the Women assert that, based on information known to it, Bayer should have proactively changed information on the label. Bayer focuses on these allegations in seeking judgment on the pleadings, asserting that federal law permitted—but did not require—proactively changing information on the approved label. Bayer maintains that any state-law claim premised on failing to take that permitted action is expressly preempted because federal law does not require the action.
[34] As the Seventh Circuit explained: “Where a federal requirement permits a course of conduct and the state makes it obligatory, the state‘s requirement is in addition to the federal requirement and thus is preempted.” McMullen v. Medtronic, Inc., 421 F.3d 482, 489 (7th Cir. 2005). Applying the foregoing principle, this Court rejected a similar claim premising liability on a failure to proactively strengthen warnings on an approved label: “We cannot imagine a plainer example of an attempt to impose a standard of care in addition to the FDA‘s specific federal requirements.” McGookin, 942 N.E.2d at 838.
[35] We conclude that federal law expressly preempts a manufacturing-defect claim based on failing to proactively strengthen warnings on the Essure label. See id. We therefore reverse the denial of the Trial Rule 12(C) motion as to that claim. Moreover, to the extent the Women predicate other tort claims on the alleged failure to proactively strengthen warnings on the label, we reverse the denial of the Trial Rule 12(C) motion as to those expressly preempted claims as well.
False or Misleading Statements
[36] The Women also allege that Bayer violated federal requirements by making false or misleading statements. The Women quote several statements that they allege were false or misleading. For example, the Women allege that a patient brochure stated that Essure was “made from the same trusted, silicone free material
[37] Trial Rule 12(C) provides that “[i]f, on a motion for judgment on the pleadings, matters outside the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgment[.]” Although Bayer directs us to matters outside the pleadings, Bayer expressly denies that this case is at the summary judgment stage—treating summary judgment as a future event at which it might assert choice-of-law issues. See Br. of Appellant at 37 n.7 (“Bayer does not concede that, at the summary judgment stage, Indiana law rather than the law of other states would necessarily apply after an appropriate choice-of-law analysis.“). Because Bayer does not concede that this case is at the summary judgment stage, we decline to consider the exhibits attached to Bayer‘s 12(C) motion.5
[38] Ultimately, the pleadings alone do not establish that Bayer made only approved statements regarding Essure. Thus, based on the pleadings, we cannot say that a tort claim premised on false or misleading statements is expressly preempted.
Implied Preemption
[39] We turn to whether the surviving manufacturing-defect claims are impliedly preempted. We find guidance in Bausch. There, the Seventh Circuit addressed whether a manufacturing-defect claim was impliedly preempted when premised on the violation of federal manufacturing requirements—conduct that would result in the device being “adulterated” under federal law. Bausch, 630 F.3d at 557. The Court determined that the claim was not impliedly preempted:
The defendants argue that [the] claim that the medical device was “adulterated” must be impliedly preempted because there is simply no state tort duty to manufacture a product that is not adulterated. We disagree. The MDA defines an “adulterated” device as a device “not in conformity with applicable
requirements or conditions.”
Id. Although Bausch involved the condition of being “adulterated,” we find the Seventh Circuit‘s reasoning equally applicable to the condition of being “misbranded,” which arises from the violation of (a) certain general requirements or (b) device-specific requirements imposed through PMA. Compare
[40] Turning to Indiana tort law, a product has a manufacturing defect under the IPLA if “it is in a condition: (1) not contemplated by reasonable persons among those considered expected users of the product; and (2) that will be unreasonably dangerous to the expected user or consumer when used in reasonably expectable ways of handling or consumption.”
[41] Such a claim does not exist “solely by virtue of the FDCA[.]” Buckman, 531 U.S. at 353. Rather, this type of claim is derived from traditional Indiana tort law that requires products to comport with the reasonable expectations of consumers. See
[42] Furthermore, we discern no way in which permitting the state-law claim would conflict with federal law or inflict major damage on a federal purpose. To be sure, the success of certain claims might involve a finding that, had Bayer complied with federal law, the FDA would have taken certain steps in response. For example, the Women allege that Bayer failed to report adverse events. If a fact-finder so finds, it could determine that Bayer is liable on a theory that, had Bayer fulfilled its reporting duties, the FDA would have changed warnings on the label—deterring the Women from choosing Essure. Bayer suggests that allowing this type of claim would amount to impermissible second-guessing of the FDA, akin to a claim of fraud that would “‘inevitably conflict with the FDA‘s responsibility to police’ violations of its own rules.” Br. of Appellant at 45 (quoting Buckman, 531 U.S. at 350). Bayer points out that sister courts have found similar claims impliedly preempted
[43] Although we acknowledge Bayer‘s reading of Buckman, we do not read the case so expansively as to preclude a fact-finder from deciding how the FDA would have responded to required reporting. Moreover, we are not persuaded that allowing such claims would interfere with the federal regulatory scheme. Ultimately, we regard the Seventh Circuit‘s approach as the most persuasive. As the Seventh Circuit noted, “[t]he idea that Congress would have granted civil immunity to medical device manufacturers for their violations of federal law that hurt patients is, to say the least, counter-intuitive.” Bausch, 630 F.3d at 549. Under the Seventh Circuit‘s approach, a claim based on “the breach of a recognized state-law duty” is not impliedly preempted where the plaintiff “can show that she was harmed by a violation of applicable federal law.” Id. at 558.
[44] We conclude that the manufacturing-defect claims are not impliedly preempted. Moreover, for the foregoing reasons, we ultimately conclude that, to the extent the Women allege that Bayer violated applicable federal requirements, the Women have stated viable claims of manufacturing defects under the IPLA.6
Inadequate Warnings or Instructions
Failure to Warn
[45] Indiana Code Section 34-20-4-2 provides the standard for whether a product is in a defective condition due to a failure to give adequate warnings: “A product is defective . . . if the seller fails to . . . properly package or label the product to give reasonable warnings of danger about the product . . . when the seller, by exercising reasonable diligence, could have made such warnings . . . available to the user or consumer.”
[46] In Count 2, the Women allege that Bayer is liable for a failure to warn. In claiming a failure to warn, the Women allege that Bayer violated federal law by (1) failing to report or adequately respond to adverse events and (2) failing to report clinical investigations or studies.7
[47] Under the IPLA, a failure-to-warn claim is viable only if the packaging or labeling did not contain adequate warnings. See
[a] claim that a manufacturer failed to provide an adequate warning at the time of sale would be based on the assertion that the manufacturer should have provided a different warning than the one approved by the FDA. Such a state-law claim would impose a requirement that was different from, or in addition to, the applicable federal requirements and would be preempted.
[48] The Women direct us to caselaw from other jurisdictions recognizing a viable state-law claim for a failure to report to the FDA. See, e.g., Stengel v. Medtronic, Inc., 704 F.3d 1224, 1233 (9th Cir. 2013) (en banc) (recognizing a viable claim under Arizona law, a type of claim the Arizona Supreme Court later rejected in Conklin v. Medtronic, Inc., 431 P.3d 571, 578-79 (Ariz. 2018)), cert. denied; Hughes v. Boston Sci. Corp., 631 F.3d 762, 769-71 (5th Cir. 2011). The Women also cite a federal case accepting at the pleading stage that Indiana law imposes a duty to warn the FDA. See Fisk v. Medtronic, Inc., No: 3:17-CV-032, 2017 WL 4247983, at *6-7 (N.D. Ind. Sep. 25, 2017). However, the cited cases are distinguishable because they do not apply the pertinent definition of a defect under the IPLA. That is, to prevail for a defect due to a failure to warn under the IPLA, a litigant must show that warnings on the labeling or packaging were inadequate. See
[49] In so concluding, we acknowledge the Women‘s point that a manufacturer cannot “sit back and do nothing” when it receives certain information regarding product safety. Br. of Appellee at 31 (emphasis removed). We agree, in that there is a federal duty to report. See
Failure to Instruct
[50] Indiana Code Section 34-20-4-2 provides the standard for whether a product is in a defective condition due to a failure to give adequate instructions: “A product is defective . . . if the seller fails to . . . give reasonably complete instructions on proper use of the product . . . when the seller, by exercising reasonable diligence, could have made such . . . instructions available to the user or consumer.”
[51] In Count 5, the Women allege that Bayer is liable for failing to give adequate instructions regarding the use of Essure. The Women allege that, in issuing the PMA, the FDA imposed a “duty to train physicians” to safely use Essure, requiring Bayer to “use reasonable care” in the training. Appellant‘s App. Vol. 3 at 191. The Women allege that Bayer breached the applicable standard of care, causing injuries due to the improper implantation of Essure devices.
[52] In addition to alleging that Bayer failed to comply with the federal training requirements, the Women allege that Bayer “independently undertook a duty of training physicians“—assuming duties beyond that which the FDA imposed. Id. at 190. The Women allege that Bayer negligently performed those self-imposed duties and is therefore liable for the failure to adequately instruct.
Express Preemption
[53] As to express preemption, Bayer disputes the scope of the FDA-imposed training requirements, directing us to an exhibit purportedly containing those requirements. Yet, for the reasons earlier discussed, we decline to consider matters outside the pleadings.10 We will therefore assume that the FDA imposed the training requirements alleged in the complaint. As to those alleged training requirements,
[54] To the extent the Women premise liability on allegedly negligent training that Bayer voluntarily undertook beyond the FDA-imposed requirements, the claim is similar to a claim addressed in Medtronic, Inc. v. Malander, 996 N.E.2d 412 (Ind. Ct. App. 2013). There, the plaintiff premised liability on allegedly deficient technical support that a device manufacturer‘s representative gave to a physician during surgery. See id. at 414-15. The Malander Court noted that the technical support did not “involve the mere restatement of information given in the labeling,” i.e., information that the FDA approved. Id. at 419. Looking to persuasive caselaw, the Malander Court ultimately determined that the conduct at issue—a specific post-approval interaction with a physician—was extra-regulatory and not expressly preempted by the MDA. See id.
[55] Bayer asserts that the instant case is distinguishable in that, in Malander, there was no indication that the FDA required any physician training whereas, here, the FDA required at least some degree of training “as part of Essure‘s labeling.” Br. of Appellant at 48. Bayer appears to suggest that, because the FDA imposed a training requirement regarding Essure, the Women cannot premise a claim on the alleged negligent performance of additional training services. According to Bayer, that type of claim would be improperly premised on requirements not found in federal law, i.e., different or additional duties.
[56] However, we conclude that, to the extent the Women premise liability on actions Bayer voluntarily undertook beyond federal requirements, those claims either: (1) do not implicate the explicit preemptive text of the MDA for the reasons identified in Malander; or (2) assert a violation of a federal requirement, in that the FDA allegedly imposed training requirements regarding Essure, and federal law generally requires a manufacturer to submit a PMA supplement before making any change that affects the safety or effectiveness of a device. See
Implied Preemption
[57] As to implied preemption, a product is defective under the IPLA if the seller negligently failed to give reasonably complete instructions on proper use. See
[58] The Women have stated a cognizable claim for a failure to adequately instruct.
Remaining Tort Claims
[59] In addition to claims of manufacturing defects in Counts 1 and 7 and claims of a failure to warn or instruct in Counts 2 and 5, the complaint involves several other tort claims. That is, the Women allege that they were physically injured by Essure as a result of (a) fraudulent misrepresentation and fraud in the inducement in Count 3; (b) fraudulent concealment and fraudulent omissions in Count 4; and (c) negligent failure to test in Count 6. At bottom, these are product-liability claims governed by the IPLA. See
[60] We reiterate that the IPLA permits only three types of product-liability claims: (1) a design defect, (2) a manufacturing defect, and (3) a defect due to failing to adequately warn or instruct. The Women have not alleged a design defect and we have already addressed whether the Women stated viable claims for a manufacturing defect and a defect due to failing to adequately warn or instruct. To the extent the Women argue that Indiana law recognizes additional types of defects, we disagree.11 Therefore, having addressed the cognizable grounds for tort liability under Indiana law, we reverse the denial of judgment on the pleadings as to the remaining tort claims. See
[61] For the foregoing reasons, we reverse the denial of judgment on the pleadings as to the tort claims set forth in Count 3, Count 4, and Count 6
Uniform Commercial Code
[62] Turning to Count 8, the Women allege that Bayer is liable under the Uniform Commercial Code (“UCC“) for the breach of an express warranty—allegations that sound in contract law rather than tort law. Decades ago, this Court concluded that the adoption of the IPLA “did not vitiate the provisions of the UCC” and that a litigant could proceed on both tort-based and contract-based theories. Hitachi Const. Mach. Co., Ltd. v. AMAX Coal Co., 737 N.E.2d 460, 465 (Ind. Ct. App. 2000) (quoting B & B Paint Corp. v. Shrock Mfg., Inc., 568 N.E.2d 1017, 1020 (Ind. Ct. App. 1991), trans. denied), trans. denied. However, in the ensuing years, our Supreme Court has “never addressed whether the [IPLA] preempts warranty-based theories of recovery for physical harm.” Kovach v. Caligor Mw., 913 N.E.2d 193, 197 (Ind. 2009). In any case, we follow this Court‘s long-standing precedent that express-warranty claims are not subsumed by the IPLA, particularly in light of the legislative inaction as to the relationship between the UCC and the IPLA. See, e.g., DePuy, Inc. v. Farmer, 847 N.E.2d 160, 168 (Ind. 2006) (discussing the doctrine of legislative acquiescence).
[63] Pursuant to the UCC as set forth in
Express warranties by the seller are created as follows:
(a) any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise.
(b) any description of the goods which is made part of the basis of the bargain creates an express warranty that the goods shall conform to the description.
(c) any sample or model which is made part of the basis of the bargain creates an express warranty that the whole of the goods shall conform to the sample or model.
Moreover, “[i]t is not necessary to the creation of an express warranty that the seller use formal words such as ‘warrant’ or ‘guarantee’ or that he have a specific intention to make a warranty,” however, “an affirmation merely of the value of the goods or a statement purporting to be merely the seller‘s opinion or commendation of the goods does not create a warranty.”
Adequacy of the Pleading
Causation
[64] As an initial matter, Bayer argues that the Women failed to adequately plead a claim of breach of warranty. Bayer asserts that the Women “simply assert a laundry list of alleged misrepresentations without describing a ‘causal link’ . . . [to] any injuries.” Br. of Appellant at 35-36. Bayer contends that the allegations are impermissibly conclusory, arguing that the complaint “includes no allegations as to which of the multitude of supposed misrepresentations were actually reviewed by each [p]laintiff, much less how they influenced each [p]laintiff‘s decisions.” Id. at 35. Yet, in alleging a breach of warranty, the Women quote statements purportedly made when advertising Essure. See, e.g., Appellant‘s App. Vol. 3 at 201 (cross-referencing statements quoted at 168-78). The Women also focus on statements on the Essure label. See, e.g., id. (cross-referencing statements quoted at 167-68). The Women allege that the representations “became part of the basis of the bargain,” id. at 202, and that “[t]he breach of the warranty was a substantial factor in
[65] Having reviewed the matter, we conclude that the allegations regarding a breach of a warranty are sufficient to satisfy the notice-pleading standard. Indeed, regardless of the number of alleged misrepresentations set forth in the complaint, Bayer nevertheless has notice of specific statements the Women allege support a claim of breach of warranty. Ultimately, Bayer is “on notice concerning why it is potentially liable and what it stands to lose.” KS&E Sports, 72 N.E.3d at 901 (quoting Noblesville Redev. Comm‘n, 674 N.E.2d at 564).
Vertical Privity
[66] Next, Bayer contends that the Women “fail to allege a crucial element of their claims for breach of express warranty—vertical privity.” Br. of Appellant at 36. “[V]ertical privity exists only between immediate links in a distribution chain.” Hyundai Motor Am., Inc. v. Goodin, 822 N.E.2d 947, 952 (Ind. 2005). “A buyer in the same chain who did not purchase directly from a seller is ‘remote’ as to that seller“—i.e., the buyer lacks vertical privity as to that seller. Id.14
[67] Here, the Women have not alleged that they acquired Essure directly from Bayer. Therefore, the Women have not alleged vertical privity. According to Bayer, the complaint is inadequate because vertical privity is required. In arguing that vertical privity is required, Bayer directs us to two federal court cases. In one of those cases, the federal court indeed concluded that “vertical privity is required for claims of breach of express warranty” under Indiana law. Atkinson v. P & G-Clairol, Inc., 813 F. Supp. 2d 1021, 1026 (N.D. Ind. 2011). However, in the other case, the federal court recognized an exception to that general requirement. See Ryden v. Tomberlin Auto. Grp., No. 1:11-cv-1215, 2012 WL 4470266, at *2 (S.D. Ind. Sep. 27, 2012). The exception is outlined in Prairie Prod., Inc. v. Agchem Div.-Pennwalt Corp., wherein this Court noted that “the authority in favor of discarding the privity requirement in express warranty cases is overwhelming.” 514 N.E.2d 1299, 1302 (Ind. 1987), reh‘g denied. This Court ultimately held that a remote purchaser was “not precluded from suing [a manufacturer] because of lack of privity of contract, where [the manufacturer] allegedly made express warranties” directly to the remote purchaser. Id.
[68] Here, the Women allege that Bayer made express warranties directly to them. See Appellant‘s App. Vol. 3 at 202-03 (alleging that affirmations of fact became express warranties and the Women relied on those warranties in using Essure). Adhering to Prairie Prod., Inc., we conclude that vertical privity is not required to pursue a claim based on those alleged express warranties. Thus, Bayer is not entitled to judgment on the pleadings due to a failure to allege vertical privity.15
Express Preemption
[69] We now turn to whether federal law expressly preempts a claim that Bayer
[70] Here, the preemptive text in the MDA prohibits only the enforcement of a different or additional state-imposed requirement. See
Implied Preemption
[71] In Buckman, the United States Supreme Court expressed concern about claims that “exist solely by virtue of the FDCA,” noting that such claims “exert an extraneous pull on the scheme established by Congress[.]” 531 U.S. at 353. Here, a claim that Bayer breached an express warranty does not involve federal law. Rather, the pertinent inquiry is whether Bayer broke a promise. See
[72] Ultimately, Bayer has not demonstrated its entitlement to judgment on the pleadings on the Women‘s claims that Bayer breached an express warranty.
Consumer Sales Act
[73] In Count 9, the final count of the complaint, the Women allege that Bayer is liable under provisions of the Indiana Consumer Sales Act. In its Brief of Appellant, Bayer mentions the Indiana Consumer Sales Act just once, baldly asserting
Conclusion
[74] Bayer is entitled to judgment on the pleadings on all tort claims premised on the failure to strengthen label warnings because federal law did not require Bayer to do so. Next, Bayer is entitled to judgment on the pleadings on all tort claims that do not involve a defect recognized by the IPLA. Further, as to the claim that Bayer is liable for a failure to warn, because the IPLA contemplates a defect only where labeling or packaging is inadequate—and because the Women have not alleged that Bayer deviated from the FDA-approved labeling or packaging—Bayer is entitled to judgment on the pleadings on that claim. We therefore reverse the denial of the 12(C) motion as to the foregoing claims. However, because Bayer has otherwise not demonstrated its entitlement to judgment on the pleadings, we affirm the judgment in all other respects.
[75] Affirmed in part, reversed in part, and remanded for further proceedings.
Najam, J., and Baker, S.J., concur.