Steven L. McCORMICK, et ux. v. MEDTRONIC, INC., et al.
No. 670, Sept. Term, 2013.
Court of Special Appeals of Maryland.
Oct. 6, 2014.
101 A.3d 467
Lindsay S. Goldberg (Laura S. Colton, Hogan, Lovells, US LLP, Baltimore, MD), Andrew E. Tauber (Scott M. Noveck,
Panel: MEREDITH, BERGER, ARTHUR, JJ.
ARTHUR, J.
This case principally concerns the extent to which federal law expressly or impliedly preempts state common-law and statutory claims for personal injuries that resulted from the so-called “off-label” promotion of a medical device.
Relying on one of the first of what are now numerous federal district court decisions concerning the specific device at issue in this case, the Circuit Court for Montgomery County ruled that federal law preempted all of the plaintiffs’ claims, except those for fraud. The court then ruled that the plaintiffs had failed to plead fraud with particularity. Consequently, the court dismissed the claims against the manufacturer with prejudice.
We shall hold that federal law does not expressly or impliedly preempt the plaintiffs’ claims concerning misrepresentations or express warranties that the manufacturer may have made in voluntary communications with the public or with members of the medical profession. We shall also hold that the plaintiffs failed to plead common-law fraud with particularity, but that the circuit court, on remand, should allow them an opportunity to replead. We shall affirm the circuit court in all other respects.
QUESTIONS PRESENTED
Appellants present two questions for our review, which we have rephrased as follows:
- Did the trial court err in holding that all of the appellants’ causes of action (except those for fraud) are expressly and impliedly preempted by federal law?
- Did the trial court err in holding that appellants had failed to plead fraud with particularity?
FACTUAL AND PROCEDURAL HISTORY
A. Introduction
This is one of numerous cases nationwide concerning the Infuse Bone Graft device, a medical device that is manufactured and marketed by defendant Medtronic, Inc.
In 2007, plaintiff Steven McCormick underwent spinal-fusion surgery, in which his surgeon, defendant Michael K. Rosner, M.D., implanted the Infuse device in an “off-label” manner—i.e., in a manner other than the one “for which it has been approved by the FDA.” Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341, 350, 121 S.Ct. 1012, 148 L.Ed.2d 854 (2001). Mr. McCormick claims to have suffered serious complications, including excessive bone growth, which allegedly necessitated a second surgery and has left him disabled. He attributes his condition to what he characterizes as Medtronic‘s “illegal” promotion of off-label uses of the device, including alleged misrepresentations concerning the risks of the off-label uses.
B. The Infuse Device
As approved by the FDA in 2002, the Infuse device consists of three components: a genetically-engineered version of a naturally-occurring protein that stimulates bone growth; a collagen sponge; and a cage or hollow cylinder that holds the vertebrae in place and directs the development of bone growth.
In surgery employing the device, the genetically-engineered protein is applied to the sponge, which acts as a carrier and scaffold for the protein. The surgeon implants the protein-infused sponge and the cage into the spine, where the protein evidently spurs the bone growth necessary to achieve the fusion. The device thus appears to have been intended to
C. FDA Approval
The McCormicks allege that the majority of spinal-fusion procedures, including those that are used to treat nerve compression, are performed by means of a “posterior approach” through the back. The McCormicks further allege that even before the FDA approved the Infuse device in 2002, Medtronic knew, from clinical trials, that when the surgeons employed a posterior approach, the use of the genetically-engineered protein led to undesired or “heterotopic” bone growth. According to the McCormicks, an FDA advisory panel admonished Medtronic to guard against the use of the device in procedures other than an “anterior approach,” by which the surgeon approaches the spine from the front of the body, through an incision in the abdomen. One panel member allegedly observed that because the cage is difficult to implant in a posterior approach, the use of the cage would prevent most surgeons from employing the posterior approach.
When the FDA approved the Infuse device, it required the labeling to warn that the device may be used only via the anterior approach. In addition, the approved labeling warns that the product “must not be used” without the cage.
D. Off-Label Marketing
The McCormicks’ complaint is replete with allegations that, after obtaining FDA approval of the Infuse device, Medtronic engaged in an extensive and (they allege) illegal effort to promote the off-label use of the device, apparently by means of a posterior approach without the required cage. The McCormicks specifically allege that Medtronic promoted the off-label use of the Infuse device by giving financial incentives to physicians, by providing physicians with information from consultants and “key opinion leaders” whom Medtronic had targeted and paid, and by placing Medtronic sales representa-
The McCormicks allege that, as a result of Medtronic‘s off-label promotion of the Infuse device, sales of the device exceeded $900 million in 2010, of which more than 85 percent resulted from off-label procedures.
E. The Spine Journal
The McCormicks’ complaint prominently mentions the July 2011 edition of a medical periodical, The Spine Journal, which, they say, devoted an entire issue to articles concerning the Infuse device. The complaint alleges that the journal articles discussed Medtronic‘s failure to accurately report the adverse side-effects that occurred in the clinical trials of the device; Medtronic‘s failure to disclose that many of the authors who studied and promoted the device had conflicts of interest because of their significant financial ties to Medtronic (having received a median range of payments of between $12 million and $16 million per study); and Medtronic‘s downplaying of the risks associated with the device (including the stimulation of excessive bone growth) while overemphasizing its advantages over conventional procedures (such as bone grafts).
F. The Disclosure of Increased Risks of Cancer
The McCormicks also allege that a November 2011 study showed that a high-dosage use of the Infuse device, which, they say, occurs in some off-label procedures, can result in a nearly four-fold increased risk of cancer. They go on to allege
G. Mr. McCormick‘s Unsuccessful Surgery
On July 27, 2007, well before the allegations about the Infuse device became public, Mr. McCormick himself underwent spinal-fusion surgery to relieve his complaints of persistent back pain. His surgeon, Dr. Rosner, took a posterior approach (rather than the approved anterior approach), and he used a Medtronic cage that the FDA had not approved for use with an Infuse bone graft. Additionally, the McCormicks appear to allege that the surgeon used an inappropriate amount of the genetically-engineered protein component of the device. According to the McCormicks’ complaint, at least one Medtronic sales representative—defendant Vincent Profitt—was present in the operating room during Mr. McCormick‘s surgery.
The McCormicks allege that the surgery did not succeed in relieving Mr. McCormick‘s complaints. As a consequence, the McCormicks allege, Mr. McCormick was unable to continue to work and was forced to go on permanent disability in October 2008. They claim that in the spring of 2010 Mr. McCormick‘s physicians discovered that he suffered from neural foraminal stenosis, or narrowing of the cervical disc space, at the site where the Infuse device had been implanted. Eventually, in September 2010, Mr. McCormick underwent revision surgery to remove the “bony overgrowth” and inflammation that had allegedly resulted from the earlier surgery in 2007. The McCormicks allege that in the revision surgery Mr. McCormick‘s surgeon was forced to chisel away the excess bone-growth that, they say, the Infuse product had caused.
According to the McCormicks, Mr. McCormick learned in August 2011 that he had two nodules in his lungs that he must monitor to ensure that they do not become cancerous. The
H. The Complaint
On the basis of these essential allegations, Mr. McCormick asserted a series of claims against Medtronic, a Medtronic subsidiary, the Medtronic sales representative who was in the operating room during his surgery (collectively, “Medtronic“), and Dr. Rosner.2
As against Medtronic, Mr. McCormick asserted claims for negligence (Count II), strict products liability (Count III), breach of warranty (Count IV), fraud (Count V), negligence per se (Count VI), and violations of the Consumer Protection Act (Count VII). As against the surgeon, Dr. Rosner, McCormick asserted a claim for failure to obtain informed consent (Count VIII). Finally, Mr. McCormick and his wife asserted a joint claim for loss of consortium (Count IX).3
I. The Proceedings in the Circuit Court
Medtronic moved to dismiss the McCormicks’ complaint on several grounds, including federal preemption and the failure to allege fraud with particularity. Dr. Rosner also moved to dismiss the complaint, arguing that the McCormicks had failed to comply with their obligation to submit their claim to the Health Care Alternative Dispute Resolution Office before filing suit. See
After a hearing, the circuit court dismissed the claims against Medtronic, relying exclusively on Caplinger v. Medtronic, Inc., 921 F.Supp.2d 1206 (W.D.Ok.2013), one of the first reported cases to consider the extent to which federal law preempts state-law claims concerning the Infuse device. Rather than dismiss the claims against Dr. Rosner, however, the court stayed the proceedings to permit the McCormicks to file the claim in the Health Care Alternative Dispute Resolution Office.
In response, the McCormicks initially asked the court to allow them to appeal the order as to Dr. Rosner under the collateral order doctrine, “a very narrow exception to the final judgment rule.” See, e.g., Nnoli v. Nnoli, 389 Md. 315, 329, 884 A.2d 1215 (2005). After the court complied with their request, however, the McCormicks dismissed the claims against Dr. Rosner, without prejudice. Then they took this appeal.
DISCUSSION
I.
Before we discuss the substantive issues in this case, we first must address whether there was a final judgment from which the McCormicks were entitled to appeal.
Although the circuit court granted Medtronic‘s motion to dismiss, the court did not adjudicate all of the claims against Medtronic‘s co-defendant, Dr. Rosner. Because the court, therefore, had “adjudicate[d] the rights and liabilities of fewer than all the parties to the action,” its ruling was “not a final judgment.”
The collateral order doctrine, which the McCormicks briefly invoked, would not assist them. Even if the doctrine somehow applied,4 the court had permitted an appeal only as to Dr. Rosner, not as to Medtronic—the party that the McCormicks most wanted to pursue.
The McCormicks did not solve the problem of Dr. Rosner‘s continued presence by dismissing all claims against him without prejudice: in Miller and Smith at Quercus LLC v. Casey PMN, LLC, 412 Md. 230, 248-53, 987 A.2d 1 (2010), the Court of Appeals held that parties cannot transform an otherwise interlocutory ruling into an appealable final judgment through the voluntary dismissal, without prejudice, of the unadjudicated aspects of a case. Thus, in light of Miller and Smith, we directed the parties, on our motion, to address whether and how we could exercise appellate jurisdiction.
Having reviewed the parties’ submissions, we are convinced that we have the power to decide the appeal under
(e) Entry of judgment not directed under Rule 2-602. (1) If the appellate court determines that the order from which the appeal is taken was not a final judgment when the notice of appeal was filed but that the lower court had discretion to direct the entry of a final judgment pursuant to
Rule 2-602(b) , the appellate court may, as it finds appropriate, (A) dismiss the appeal, (B) remand the case for the lower court to decide whether to direct the entry of a final judgment, (C) enter a final judgment on its owninitiative or (D) if a final judgment was entered by the lower court after the notice of appeal was filed, treat the notice of appeal as if filed on the same day as, but after, the entry of the judgment.
(Emphasis added.)
In other words, if this Court confronts an improper, interlocutory appeal in a case where the circuit court could have certified its ruling as final and appealable under
(b) When allowed. If the court expressly determines in a written order that there is no just reason for delay, it may direct in the order the entry of a final judgment: (1) as to one or more but fewer than all of the claims or parties; or (2) pursuant to
Rule 2-501(f)(3) , for some but less than all of the amount requested in a claim seeking money relief only.
(Emphasis added.)
In dismissing the claims against Medtronic but not against Dr. Rosner, the circuit court disposed of all claims against one or more, but fewer than all, of the parties. If, therefore, the circuit court had expressly determined in a written order that there was no just reason to delay the entry of final judgment as to Medtronic, it would have had some discretion to certify an immediate appeal of that ruling under
Under Barclay, the circuit court could properly have exercised its discretion to certify its ruling as to Medtronic as an appealable final judgment under
An appellate court “should be reluctant” to enter judgment on its own initiative under
In these specific circumstances, it would make little sense not to permit the appeal to proceed. If we were to dismiss the appeal because of a “technical” problem (Smith, 386 Md. at 26, 871 A.2d 545) resulting from the decision to stay rather than dismiss the claims against Dr. Rosner, we would only prolong the litigation and increase the financial hardship that the plaintiffs face. Thus, because the circuit court could have certified its ruling as final under
II.
The McCormicks’ claims arise against the backdrop of a highly-detailed scheme of federal regulation. To evaluate the extent to which federal law preempts the McCormicks’ claims, we must examine that scheme at some length.
A. The FDCA and the MDA
In 1938, Congress passed the Federal Food, Drug, and Cosmetic Act (the “FDCA“),
In the 1970s, in the aftermath of the failure of some complex devices, particularly the Dalkon Shield,6 several states adopted regulatory measures, including measures requiring premarket approval of new devices. Id. In an effort to standardize the regulatory environment, Congress responded by passing the Medical Device Amendments of 1976 (the “MDA“),
The MDA contains an express preemption provision, which provides, in pertinent part, as follows:
[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.
The MDA established three levels of oversight of medical devices: Class I, Class II, and Class III. Class I, which
A device is classified as Class III if “it cannot be established that a less stringent classification would provide reasonable assurance of safety and effectiveness, and the device is ‘purported or represented to be for a use in supporting or sustaining human life or for a use which is of substantial importance in preventing impairment of human health,’ or ‘presents a potential unreasonable risk of illness or injury.‘” Id. at 317, 128 S. Ct. 999 (quoting
Unless the FDA deems a new Class III device to be “substantially equivalent” to a device that was on the market in 1976, the device must go through a “rigorous regime of premarket approval.” Riegel, 552 U.S. at 317, 128 S. Ct. 999. To begin that process, the manufacturer must submit what is typically a multi-volume application, which includes:
full reports of all studies and investigations of the device‘s safety and effectiveness that have been published or should reasonably be known to the applicant; a “full statement” of the device‘s “components, ingredients, and properties and of the principle or principles of operation“; “a full description of the methods used in, and the facilities and controls used for, the manufacture, processing, and, when relevant, pack
ing and installation of, such device“; samples or device components required by the FDA; and a specimen of the proposed labeling.
Id. at 318, 128 S. Ct. 999 (quoting
“Before deciding whether to approve the application, the agency may refer it to a panel of outside experts, ... and may request additional data from the manufacturer.” Id. (citing
The FDA “grants premarket approval only if it finds there is a ‘reasonable assurance’ of the device‘s ‘safety and effectiveness.‘” Riegel, 552 U.S. at 318, 128 S. Ct. 999 (quoting
“The premarket approval process includes review of the device‘s proposed labeling.” Id. “The FDA evaluates safety and effectiveness under the conditions of use set forth on the label ... and must determine that the proposed labeling is neither false nor misleading.” Id. (citing
After the FDA has granted premarket approval, the MDA imposes further restrictions. For instance, without FDA permission, the manufacturer may not make any “changes in design specifications, manufacturing processes, labeling, or any other attribute, that would affect safety or effectiveness.” Riegel, 552 U.S. at 319, 128 S. Ct. 999 (citing
B. Express Preemption Under the MDA
As stated above, the MDA expressly preempts certain state-law “requirement[s]” “with respect to” federally-regulated medical devices—specifically, requirements that “relate[] to the safety or effectiveness of the device” and are “different from, or in addition to, any requirement applicable” under the MDA itself.
In Riegel, 552 U.S. at 323-24, 128 S. Ct. 999, the Supreme Court held that common-law causes of action for negligence and strict liability impose “requirements,” within the meaning of the MDA‘s express preemption provision in
Since the Riegel decision in 2008, numerous courts have recognized that the MDA expressly preempts state-law claims only when a manufacturer has complied with federal law, and not when the manufacturer has in some way violated federal law. See, e.g., Hughes v. Boston Scientific Corp., 631 F.3d 762, 769 (5th Cir. 2011); Bausch v. Stryker Corp., 630 F.3d 546, 549-50 (7th Cir. 2010), cert. denied, 565 U.S. 976, 132 S. Ct. 498, 181 L. Ed. 2d 346 (2011); see also Stengel v. Medtronic Inc., 704 F.3d 1224, 1232-33 (9th Cir. 2013) (en banc) (holding that the MDA did not expressly preempt a parallel state-law claim based on violations of FDA regulations regarding reporting of adverse events). As the Seventh Circuit stated: “The 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.
Nonetheless, even though a state-law claim may survive express preemption if it is based on a violation of federal law, it may be impliedly preempted if it is based solely on a violation of federal law or if the claim would not exist but for federal law. Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341, 352-53, 121 S. Ct. 1012, 148 L. Ed. 2d 854 (2001). Buckman specifically prohibits an attempt to bring a putative state-law claim alleging that a manufacturer defrauded the FDA in obtaining approval for its device. More generally, Buckman prohibits the private enforcement of the statutes and regulations that the FDA alone is empowered to enforce.
In Buckman, 531 U.S. at 343-46, 121 S. Ct. 1012, the device manufacturer allegedly obtained FDA approval by making fraudulent representations to the FDA about the intended use of the device (bone screws). The manufacturer had unsuccessfully applied for approval for the use of the device in spinal surgery. After the FDA rejected the initial application, the manufacturer revised the application to specify a different use (“long bone surgery“). The FDA approved the revised application for that purpose, but physicians later used the device for the so-called “off-label” purpose of spinal surgery. The plaintiffs, who were injured because of the off-label use of the device in spinal surgery, claimed that they would not have suffered damages but for the alleged misrepresentations to the FDA. See id. at 346-47, 121 S. Ct. 1012.10
In reaching its decision, the Court explained that the FDA must achieve a “delicate balance of statutory objectives” (id.), and it expressed its concern that the balance could be “skewed by allowing fraud-on-the-FDA claims under state tort law.” Id. In this regard, the Court specifically observed that under federal law the FDA may respond to fraud by instigating both civil and criminal proceedings. Id. at 349, 121 S. Ct. 1012 (citing
Because Buckman involved the off-label use of an FDA-approved device, the Court took pains to remark that off-label usage “is an accepted and necessary corollary of the FDA‘S mission to regulate in this area without directly interfering with the practice of medicine.” Id. at 350, 121 S. Ct. 1012. The Court worried that fraud-on-the-FDA claims could deter off-label use even though “the FDCA expressly disclaims any intent to directly regulate the practice of medicine, ... and even though off-label use is generally accepted.” Id. at 350-51, 121 S. Ct. 1012 (citing
Finally, the Court rejected the plaintiffs’ effort to characterize their fraud-on-the-FDA claim as a parallel, state-law claim that would survive express preemption under the MDA. The Court explained that, unlike (for example) a claim concerning the failure to use reasonable care in manufacturing a device, the claims in Buckman “exist[ed] solely by virtue of the FDCA disclosure requirements.” Id. at 352-53, 121 S. Ct. 1012. The plaintiffs, thus, were not “relying on traditional state tort law which had predated the federal enactments in question.” Id. at 353, 121 S. Ct. 1012. Accordingly, their claims were impliedly preempted. See id.
In light of Riegel and Buckman, a plaintiff can survive a preemption challenge to a state-law tort claim concerning an allegedly defective medical device only by steering between the Scylla of express preemption under
In other words, “the conduct on which the plaintiff‘s claim is premised must violate the FDCA if the claim is to escape express preemption,” but the conduct must also be “the type of conduct that would traditionally give rise to liability under state law—and that would give rise to liability under state law even if the FDCA had never been enacted.” Riley v. Cordis Corp., 625 F. Supp. 2d 769, 777 (D. Minn. 2009) (emphasis in original). To put it another way, “[t]he plaintiff must be suing for conduct that violates the FDCA (or else his claim is expressly preempted by
E. The Legality of Off-Label Promotion
A central feature of the McCormicks’ complaint is their repeated allegation that Medtronic has engaged in what they call illegal, off-label promotion of the Infuse device. The legality of off-label promotion is important to this case because the McCormicks can avoid express preemption only if their claims are based on some violation of federal law. See Riegel,
To understand the legality of off-label promotion, it is necessary, first, to distinguish between off-label uses by healthcare practitioners and the promotion of off-label uses by manufacturers. Off-label use by members of the medical profession “is permissible under the terms of the MDA.” Cornett, 211 N.J. at 380, 48 A.3d 1041; see Buckman, 531 U.S. at 351 n. 4, 121 S. Ct. 1012. In fact, Congress has specifically denied the FDA any power “to limit or interfere with the authority of a health care practitioner to prescribe or administer any legally marketed device to a patient for any condition or disease within a legitimate health care practitioner-patient relationship.”
Off-label promotion by a manufacturer, however, stands on different footing from off-label use by a healthcare practitioner, because off-label promotion may constitute “misbranding,” a criminal violation of the FDCA.
Although “[f]ederal law does not expressly define, or ban, off-label promotion[,] ... the FDCA prohibits ‘the adulteration or misbranding of any food, drug, device, tobacco product, or cosmetic in interstate commerce.‘” Schouest v. Medtronic, Inc., 13 F. Supp. 3d 692, 701 (S.D. Tex. 2014) (quoting
On the basis of this web of statutes and regulations, the FDA takes the position that off-label promotion can constitute misbranding in violation of the FDCA. See Schouest, 13 F. Supp. 3d at 701. “Based on this view, the FDA has recovered millions of dollars in settlements from drug manufacturers that have engaged in off-label promotion.” Id.
The FDA has, however, recognized a safe harbor that allows manufacturers of Class III devices to provide members of the medical profession with peer-reviewed articles or reference publications concerning the safety, effectiveness, or benefit of the off-label uses of the device. See Riley, 625 F. Supp. 2d at 781-82; Cornett, 211 N.J. at 382, 48 A.3d 1041 (citing
Furthermore, one federal appellate court has held, by a 2-1 margin, that the First Amendment prohibits the United States from prosecuting a person for misbranding if he or she has merely engaged in off-label promotion that does not involve untruthful or misleading statements. United States v. Caronia, 703 F.3d 149, 168-69 (2d Cir. 2012) (the FDCA does not prohibit the “truthful off-label promotion of FDA-approved prescription drugs“). In that case, however, the government had not argued “that the promotion in question was false or misleading.” Id. at 165 n. 10. Indeed, the court observed that
“Out of this muddy statutory and regulatory framework,” Schouest, 13 F. Supp. 3d at 702, a growing number of courts have begun to conclude that “federal law bars off-label promotion when it is false or misleading.” Id. (citing Houston v. Medtronic, Inc., 957 F. Supp. 2d 1166, 1179 & n. 8 (C.D. Cal. 2013); see also Martin v. Medtronic, Inc., 63 F. Supp. 3d 1050, 1058 (D. Ariz. 2014) (“The FDCA does prohibit untruthful off-label promotion“); Beavers-Gabriel v. Medtronic, Inc., 15 F. Supp. 3d 1021, 1035 (D. Haw. 2014) (“[T]he FDCA prohibits ‘misbranding’ of medical devices, which includes either misleading labeling or misleading advertising of the medical device“); Brady v. Medtronic, Inc., 2014 WL 1377830, at *7 (S.D. Fla. Apr. 8, 2014) (claim based on affirmed misrepresentations in off-label promotion was not preempted); Riley, 625 F. Supp. 2d at 783 (failure to warn claim could escape express preemption if plaintiff alleged that manufacturer affirmatively promoted off-label use in a manner that violated federal law); Cornett, 211 N.J. at 390-91, 48 A.3d 1041 (failure to warn claim, based on misrepresentations in off-label promotion outside of safe harbor, was not expressly preempted)).
Accordingly, we hold that the MDA does not expressly preempt state-law claims that are based on a violation of the federal prohibition of false or misleading off-label promotion.13
F. Which Claims Are Preempted?
We turn now to the specific allegations of the McCormicks’ complaint, to determine which, if any, are expressly or impliedly preempted.
1. The Misrepresentation-Based Claims. The McCormicks’ complaint contains a series of counts that are based on misrepresentations, intentional or otherwise: Count V alleges common-law fraud; Count II alleges negligence and includes allegations of negligent misrepresentation; and Count VII alleges violations of the Consumer Protection Act,
These claims are preempted insofar as they attack the accuracy or adequacy of the statements that Medtronic made in the FDA-mandated and FDA-approved labeling. See, e.g., Hughes, 631 F.3d at 769; Martin, 63 F. Supp. 3d at 1058; Beavers-Gabriel, 15 F. Supp. 3d at 1031; Gavin v. Medtronic, Inc., 2013 WL 3791612, at *12. To fault Medtronic for making the statements that the FDA required it to make, or to impose liability on Medtronic for not making statements that the FDA required
Section
Furthermore, because those misrepresentation claims predate the FDCA and would continue to exist even if the FDCA were repealed, they do not depend on the FDCA for their existence. See, e.g., Houston, 957 F. Supp. 2d at 1179 (“fraudulent advertising claims are not impliedly preempted under Buckman because they are moored in traditional state common law that exists independently from the FDCA“); Arthur v. Medtronic, Inc., 2014 WL 3894365, at *7 (E.D. Mo. Aug. 11, 2014) (same); Blankenship v. Medtronic, Inc., 6 F. Supp. 3d 979, 992 (E.D. Mo. 2014); Schouest, 13 F. Supp. 3d at 704 (fraud is “a venerable common law claim[ ]“); Martin, 63 F. Supp. 3d at 1058
Our ruling applies not only to the common-law claims for fraud and negligent misrepresentation (which is embodied in the generic negligence claim), but also to the separate statutory claim for unfair and deceptive trade practices under the Consumer Protection Act. See Schouest, 13 F. Supp. 3d at 708 (“a deceptive act in the promotion of the Infuse device would survive a preemption challenge for the same reasons that [the plaintiff]‘s fraud and negligent misrepresentations claim [sic] would“).14
2. Negligence. Count II of the McCormicks’ complaint asserts a claim for negligence. As the court in Riley said of the complaint in that case, the allegations here are both “prolix and uninformative,” Riley, 625 F. Supp. 2d at 780 n. 5, in that they attack a wide variety of conduct. Some of the allegations are preempted; some are not.
We have already held that federal law neither expressly nor impliedly preempts the allegations of negligent misrepresentations in the context of off-label promotion outside the scope of the safe harbor. For similar reasons, federal law does not preempt the allegations concerning the failure to disclose material facts concerning the device and the failure to “fully disclose” the results of testing on the device, provided that those omissions occurred in the context of off-label promotion and that the omitted facts were necessary to make Medtronic‘s other statements not misleading.
Nonetheless, the negligence claim is expressly preempted to the extent that the McCormicks intend to challenge the adequacy of the FDA-approved warnings on the labeling: if such a claim were allowed to proceed, Medtronic would face liability under state law even though it had fully complied with federal law. See Martin, 63 F. Supp. 3d at 1064; Beavers-Gabriel, 15 F. Supp. 3d at 1041; Hawkins v. Medtronic, Inc., 2014 WL 346622, at *9. Riegel prohibits such a result. See Houston, 957 F. Supp. 2d at 1180 (a state claim is parallel to federal law, and thus not expressly preempted, only if there is no likelihood that the defendant could be held liable
Furthermore, to the extent that the McCormicks’ allegations solely concern a failure to disclose material facts or test results to the FDA in the premarket approval process, they are impliedly preempted under Buckman, because they would amount to allegations of fraud on the FDA, which the FDA alone may pursue. See Cornett, 211 N.J. at 389, 48 A.3d 1041 (to the extent that claim was ”based solely on a contention that defendants obtained FDA approval for the device only after submitting fraudulent representations to or withholding material information from the FDA, this claim falls squarely within the Buckman implied preemption rule“) (emphasis in original).
The claims are also impliedly preempted to the extent that they may concern the act of off-label promotion itself, divorced from any misrepresentations that Medtronic may have made in the course of off-label promotion. Such a claim exists solely by virtue of the federal statutes and regulations that concern misbranding, and the claim has no independent existence in Maryland law. See Houston, 957 F. Supp. 2d at 1178. “Permitting this claim to proceed would essentially allow a private litigant to attempt to enforce the FDCA,” id., which the statute itself expressly prohibits.
Courts have divided on the question of whether a negligent failure to warn claim is expressly preempted. Some would allow such claims to proceed, at least insofar as they are “founded on” the promotion of off-label uses beyond the safe harbor recognized by the FDA. Cornett, 211 N.J. at 391, 48
We agree that federal law would preempt any effort to impose an amorphous duty to warn that required Medtronic to give warnings “different from, or in addition to,” those in the FDA-approved labeling: under federal law, Medtronic cannot deviate from the FDA-prescribed labeling without the FDA‘s permission. See Schouest, 13 F. Supp. 3d at 703. However, to the extent that the failure to warn claim simply restates the McCormicks’ claim for the failure to disclose material facts that were necessary to make Medtronic‘s other statements not misleading in the context of off-label promotion, it may proceed for the same reason that the misrepresentation-based claims may proceed.16
3. Strict Products Liability. Count III of the complaint purports to state a claim for strict products liability, but it is unclear what particular theory the McCormicks intend to pursue. For example, they do not specifically allege that the Infuse product was somehow defective or unreasonably dangerous. Instead, they allege that the off-label use of the product in the posterior approach was “defective, unsafe, and ineffective.” Elsewhere, they make allegations that sound in fraud or negligent misrepresentation as they reiterate their many complaints about off-label promotion. In addition, they
To the extent that the complaint would impose liability on the basis of the risk-utility or consumer-expectation tests, it is expressly preempted under
The complaint also fails to state a claim insofar as it attempts to premise a products liability claim on off-label use: products liability law concerns products, not the uses of products. In any event, to the extent that the McCormicks’ products liability claim is a stand-in for a complaint about the off-label use of the Infuse product, it is impliedly preempted under Buckman, because the concept of illegal off-label use or promotion of a medical device would not exist but for the FDCA. See Cornett, 211 N.J. at 389, 48 A.3d 1041.
Finally, to the extent that the products liability claim repeats the allegations of misrepresentation and failure to warn, we reiterate our prior conclusions: federal law neither expressly nor impliedly preempts claims of misrepresentation in the context of off-label marketing outside of the safe harbor, but it does expressly preempt any challenge to the adequacy of the warranty or disclosures in the FDA-approved labeling for the Infuse device. Furthermore, federal law impliedly preempts any attempt to recover damages on the basis of a contention that Medtronic obtained FDA approval for the device only after submitting fraudulent representations to or withholding material information from the FDA.17
4. Breach of Warranty. Count IV of the McCormicks’ complaint alleges a claim for breach of warranty. The complaint mentions express warranties to physicians and members of the public, as well as the implied warranties of merchantability and fitness for a particular purpose under the Uniform Commercial Code. See
To the extent that the McCormicks allege the breach of the implied warranties of merchantability or fitness for a particular purpose, their claims are expressly preempted: to impose additional warranties by operation of law would be to impose requirements that are “different from, or in addition to,” the specific warranties or representations that the FDA required Medtronic to make in the packaging and labeling that accompanies the product. See Schouest, 13 F. Supp. 3d at 707. Therefore, the circuit court correctly concluded that the McCormicks failed to state a claim for breach of implied warranty.
Similarly, to the extent that the breach of express warranty claim is based solely on alleged warranties in the FDA-approved labeling, the claim is expressly preempted: to hold otherwise would be to hold that a manufacturer could face liability under state law even though it had done exactly what it is required to do under federal law. See Riley, 625 F. Supp. 2d at 787, 788; see also Cornett, 211 N.J. at 392, 48 A.3d 1041. Because a state-law claim is “parallel” (and thus not expressly preempted) only if there is no likelihood that the manufacturer could be held liable under state law unless it had also violated federal law (Houston, 957 F. Supp. 2d at 1180), the express warranty claim cannot survive insofar as it is based on the FDA-approved labeling itself.
Nor would such a claim be impliedly preempted under Buckman. The claim for breach of express warranty has a long and venerable history in Maryland (see, e.g., Schley v. Zalis, 172 Md. 336, 191 A. 563 (1937)), and elsewhere. Houston, 957 F. Supp. 2d at 1181; Martin, 63 F. Supp. 3d at 1064. It predated the FDCA, and it would continue to exist if the FDCA were repealed in its entirety. Therefore, to the extent that the breach of warranty
G. Failure to Plead Fraud With Particularity
As an alternative ground for a part of its decision, the circuit court, like the Caplinger court on which it relied, ruled that the plaintiffs had not pleaded fraud with the requisite degree of particularity. We agree.
Although
The requirement of particularity ordinarily means that a plaintiff must identify who made what false statement, when, and in what manner (i.e., orally, in writing, etc.); why the statement is false; and why a finder of fact would have reason to conclude that the defendant acted with scienter (i.e., that the defendant either knew that the statement was false or acted with reckless disregard for its truth) and with the intention to persuade others to rely on the false statement. See, e.g., Spaulding v. Wells Fargo Bank, N.A., 714 F.3d 769, 781 (4th Cir. 2013) (Davis, J.) (concerning the analogous federal rule).
In this case, the McCormicks’ complaint satisfactorily alleges that the Medtronic defendants knew that the off-label use of the Infuse product could lead to many, serious side-effects, including the side-effects that Mr. McCormick claims to have suffered. Similarly, the complaint satisfactorily alleges that the Medtronic defendants intended to induce physicians, including Mr. McCormick‘s physician, to rely on the alleged misrepresentations and to use the Infuse product in the allegedly dangerous, off-label procedures. The complaint, however, lacks specificity in alleging when and how the Medtronic defendants made the false statements of material fact (or failed to disclose material facts that were necessary to make other statements not misleading). Instead, the complaint repeatedly makes vague references to Medtronic‘s failure to accurately report the side-effects from its clinical trials and to its failure to report that many of the authors who studied and promoted the Infuse product had significant financial ties to Medtronic. Because these vague allegations fail to meet the standard of particularity, the circuit court correctly dismissed the fraud claim.
Ordinarily, however, when a circuit court dismisses a complaint for a pleading defect, it should afford the plaintiff an
H. Failure to Plead Consumer Protection Violations with Particularity
Citing Lloyd v. General Motors Corp., 397 Md. at 108, 916 A.2d 257 (2007), Medtronic argues that the McCormicks’ Consumer Protection Act claim is premised on fraud and, thus, must be pleaded with particularity. Medtronic is correct in part and incorrect in part.
Under the Consumer Protection Act, an “unfair and deceptive trade practice” replicates common-law fraud insofar as it includes “[d]eception, fraud, false pretense, false premise, misrepresentation, or knowing concealment, suppression, or omission of any material fact with the intent that a consumer rely on the same in connection with ... [t]he promotion or sale of any consumer goods....”
Under other provisions of the act, however, a party can allege an “unfair and deceptive trade practice” without replicating a claim for common-law fraud. For example, an “unfair or deceptive trade practice” may include a “[f]alse,
CONCLUSION
In summary, we reverse the circuit court‘s conclusion that federal law preempts the claims for fraud, negligent misrepresentation, and violations of the Consumer Protection Act insofar as those claims are based on false statements of material fact that Medtronic may allegedly have made in voluntary communications with the public or members of the medical professions, in the context of off-label promotion of the Infuse device, and outside of the safe-harbor that permits the distribution of peer-reviewed articles or reference publications concerning the safety, effectiveness, or benefit of the off-label uses of the device. We also reverse the circuit court‘s conclusion that federal law preempts the claims for the breach of any express warranties that Medtronic may have made in voluntary communications with the public or members of the medical professions outside of the context of the FDA-mandated and FDA-approved labeling for the device. We affirm the
JUDGMENTS REVERSED AND REMANDED TO THE CIRCUIT COURT FOR MONTGOMERY COUNTY FOR FURTHER PROCEEDINGS NOT INCONSISTENT WITH THIS OPINION; COSTS TO BE PAID ONE-HALF BY APPELLANT AND ONE-HALF BY APPELLEE.