Court of Special Appeals sails uncharted waters of FDCA preemption right into monsters of Greek mythology

By Jonathan Biran

In McCormick v. Medtronic, Inc., Ct. of Spec. App. Md., No. 670, Sept. Term 2013 (Oct. 6, 2014), the Court of Special Appeals recently decided a preemption issue that is percolating up through courts around the country: the extent to which federal law preempts state claims for personal injuries resulting from “off-label” promotion of a medical device. Most of the decisions that have come out so far on this question have been issued by federal district courts; the CSA’s opinion was one of the first appellate decisions to tackle it. Given the careful and thoughtful treatment the CSA gave the issue, McCormick likely will be an influential decision as more appellate courts weigh in on this question. As noted below, at one point the Court compared express and implied preemption to Scylla and Charybdis, two monsters from Greek mythology – perhaps a somewhat overblown analogy, but, for those of us who appreciate the ancient myths and find preemption analysis sometimes a bit dry, the allusion was a welcome addition to the opinion.

In 2007, Steven McCormick underwent spinal-fusion surgery in an effort to relieve his persistent back pain. As part of the surgery, McCormick’s surgeon implanted a medical device known as the Infuse Bone Graft, which is manufactured and marketed by medical device giant Medtronic, Inc. As approved by the FDA, 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 using the device, the genetically engineered protein is applied to the sponge, which is then implanted with the cage into the spine, where the protein spurs the bone growth necessary to achieve the fusion.

While the majority of spinal-fusion procedures are performed through a “posterior approach” – via an incision in the back of the patient – when the FDA approved Medtronic’s Infuse device, it required the labeling to warn that the device may be used only via an anterior approach, i.e., through an incision in the abdomen. In addition, the approved labeling warns that the product “must not be used” without the cage. According to the allegations in the complaint, even before the FDA approved the Infuse device in 2002, Medtronic knew from clinical trials that, when surgeons employed a posterior approach, the use of the genetically engineered protein led to undesired and excessive bone growth. Apparently, a posterior approach also makes it very difficult to successfully implant the Infuse device’s cage.

For McCormick’s procedure, the surgeon used the Infuse device in an “off-label” manner by taking a posterior approach and using a different Medtronic cage that the FDA had not approved for use with an Infuse bone graft. According to the complaint, the surgery was not successful, and McCormick was forced to go on permanent disability in October 2008. Even worse, according to the complaint, McCormick’s physicians subsequently discovered that he suffered from neural foraminal stenosis (a narrowing of the cervical disc space) at the site where the Infuse device had been implanted. Eventually, in September 2010, McCormick underwent revision surgery to remove the “bony overgrowth” and inflammation that had allegedly resulted from the implantation of the Infuse device as part of the earlier treatment.

McCormick and his wife filed suit against Medtronic and other defendants in Montgomery County Circuit Court, alleging various causes of action, including negligence; strict products liability; breach of warranty; fraud; and violations of the Consumer Protection Act. Medtronic moved to dismiss the McCormicks’ complaint on several grounds, including federal preemption and the failure to allege fraud with particularity. With respect to the preemption issue, Circuit Judge Dugan relied on a federal district court decision from Oklahoma, Caplinger v. Medtronic, Inc.921 F. Supp. 2d 1206 (W.D. Okla. 2013), one of the first reported cases to consider the extent to which federal law preempts state-law claims concerning the Infuse device.

The district court in Caplinger held, among other things, that Ms. Caplinger’s state-law fraudulent misrepresentation claims were preempted by federal law. Persuaded by Caplinger, Judge Dugan granted Medtronic’s motion to dismiss as preempted (and, alternatively, on the basis that fraud was not particularly pleaded). The McCormicks appealed, and the Court of Special Appeals reversed in substantial part in an opinion authored by Judge Arthur (a member of the editorial board of this blog before he was appointed to the bench earlier this year) and joined by Judges Meredith and Berger.

The CSA began by recounting some of the relevant statutory and regulatory history. The Court noted that, in the 1970s, following the failure of some complex medical devices, particularly the Dalkon Shield, several states adopted regulatory measures requiring premarket approval of new devices. In an effort to standardize the regulatory environment, Congress responded by amending the Federal Food, Drug, and Cosmetic Act (the “FDCA”), 21 U.S.C. § 301 et seq., by passing the Medical Device Amendments of 1976 (the “MDA”), 21 U.S.C. § 360c et seq., which imposed a regime of detailed federal oversight of certain medical devices.

As relevant to a Class III medical device (such as the Infuse Bone Graft), the MDA requires the manufacturer to submit a very detailed application to the FDA for premarket approval that undergoes a lengthy and rigorous review process. By law, the FDA grants premarket approval only if it finds there is a reasonable assurance of the device’s safety and effectiveness. The premarket approval process includes review of the device’s proposed labelingThe 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.

Thus, premarket approval incorporates an FDA finding that a device is safe and effective under the conditions of use included on the label and that the label is not false or misleading. 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. If the manufacturer wishes to make such a change, it must submit, and the FDA must approve, an application for supplemental premarket approval, which is evaluated under largely the same criteria as an initial application.

The MDA contains an express preemption provision, which provides, in pertinent part:

[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.

21 U.S.C. § 360k(a). It is now settled that state causes of action for negligence and strict liability impose “requirements” within the meaning of the MDA’s express preemption provision in § 360k(a). See Riegel v. Medtronic, Inc.552 U.S. 312 (2008). As the Supreme Court held in Riegel, because the plaintiffs contended that a Class III medical device (a heart catheter) was defective under state law notwithstanding the manufacturer’s full compliance with all of the requirements that the FDA had imposed, the MDA expressly preempted their claims. Id. at 323-30.

That is, the plaintiffs had improperly attempted to impose state-law requirements that were “different from, or in addition to,” the requirements for safety and effectiveness that the FDA itself had imposed. However, “[s]tate requirements are pre-empted under the MDA only to the extent that they are ‘different from, or in addition to,’ the requirements imposed by federal law.” Id. at 330 (quoting 21 U.S.C. § 360k(a)(1)). The express preemption provision therefore doesn’t prevent a state from providing a damages remedy for claims premised on a violation of FDA regulations.

Courts have also recognized that the federal regulatory regime impliedly preempts putative state law claims to the extent they are based solely on manufacturers’ misstatements or omissions to the FDA. See Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341 (2001). That is, although 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 specifically prohibits an attempt to bring a putative state-law claim alleging that a manufacturer defrauded the FDA in obtaining approval for its device. Buckman’s rationale is that the FDA alone is empowered to enforce the governing federal law by seeking remedies for violations. Under this rationale, state-law “fraud-on-the-FDA” claims therefore conflict with, and therefore are impliedly preempted by, federal law.

Invoking Greek mythology, the CSA described this framework as the “Scylla and Charybdis of Express and Implied Preemption.” Slip Op. at 22. (Scylla and Charybdis were sea monsters that were said to occupy opposite sides of a narrow waterway. Scylla was thought to be a six-headed monster that emerged from a cave to devour sailors, while Charybdis took the form of a deadly whirlpool. They were close enough to each other in the water that sailors were forced to choose what they considered the lesser of two evils; it was virtually impossible to steer safely between both.) “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.” Id. at 23 (quoting Riley v. Cordis Corp., 625 F. Supp. 2d 769, 777 (D. Minn. 2009) (internal quotation marks omitted)).

The Court then turned to the McCormicks’ claims, which focus primarily on allegations that Medtronic engaged in “illegal, off-label promotion of the Infuse device.” Id. As the Court explained, “[t]he 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.” Id. The Court distinguished between off-label use of medical devices by healthcare practitioners, which is legal, and the promotion of off-label uses by manufacturers through false or misleading means, which may constitute “misbranding,” a criminal violation of the FDCA. The Court held 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. However, the Court noted that there is 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.

Analyzing the McCormicks’ specific claims, the Court found some to be preempted but several not to be preempted. To the extent any of the claims attacked the accuracy or adequacy of the statements Medtronic made in the FDA-mandated and FDA-approved labeling, the Court held such claims to be preempted: “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 it not to make, would be to impose state-law requirements that are ‘different from, or in addition to,’ those imposed by the FDCA.” Id. at 29. However, the Court held that the McCormicks’ claims could go forward to the extent they concern misrepresentations that Medtronic allegedly made in voluntary communications with the medical profession or the public outside the scope of the safe harbor: “Insofar as Medtronic’s alleged misrepresentations consist of false statements of material fact in the context of off-label promotion, outside the scope of the safe harbor, a state-law misrepresentation claim would parallel the FDCA prohibitions on off-label marketing. To that extent, therefore, a state-law misrepresentation claim would not impose any requirements different from or in addition to those imposed under federal law.” Id.

Because such 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 and therefore are not impliedly preempted under Buckman. The Court stated that this ruling applied not only to the McCormicks’ common-law claims for fraud and negligent misrepresentation, but also to their separate statutory claim for unfair and deceptive trade practices under the Consumer Protection Act. The Court analyzed the remainder of the McCormicks’ claims in similar fashion, finding claims not to be preempted where they concerned allegations of off-label promotion through false and misleading statements made outside of the safe harbor.

The CSA agreed with the Circuit Court’s alternative ground for dismissal, namely that the McCormicks had failed to plead fraud with sufficient particularity. However, the CSA found error in the Circuit Court’s failure to allow the McCormicks an opportunity to correct their pleading defects. On remand, the McCormicks will have to do a better job of alleging when and how Medtronic made the allegedly false statements of material fact (or failed to disclose material facts that were necessary to make other statements not misleading).

As noted above, Judge Dugan relied on the federal Western District of Oklahoma decision in Caplinger in concluding erroneously that all of the McCormicks’ claims were preempted. The U.S. Circuit Court of Appeals for the 10th Circuit heard argument in Caplinger in January 2014; the fact that the 10th Circuit has now had Caplinger under submission for 10 months suggests that the judges may be finding the case to be a difficult one to resolve, and/or that the panel may be divided. After the Court of Special Appeals released its opinion in McCormick, the plaintiff in Caplinger filed a Rule 38(j) letter notifying the Tenth Circuit panel about the decision. Medtronic responded with a letter asserting that McCormick was not helpful to Ms. Caplinger.

Those letters can be found here and here. Although Medtronic’s attorneys sought to take the sting out of McCormick in various ways, I found their letter unconvincing (although, to be fair, the 350-word limit on Fed. R. App. P. 38(j) letters makes it difficult to get many points across in them). It will be interesting to see how much air time the 10th Circuit gives to the CSA’s opinion in McCormick. And, of course, the CSA’s opinion may well not be the last word in the Maryland courts concerning the viability of the McCormicks’ claims.

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