Hits and Misses for May 2018

Given the volume of news affecting the life sciences, there are always some favorable outcomes and some that trend in the opposite direction. Following are a few recent developments of note, including one that provided good news for the companies in question, and another that is still unfolding.

Fifth Circuit Blasts Pinnacle Hip Decision

In the area of liability law, the big miss over the past couple of weeks for litigants was the decision by the Fifth Circuit Court of Appeals regarding the Pinnacle hip multi-district litigation. The outcome is of course a significant win for DePuy Orthopedics and its parent, Johnson & Johnson, but the case was remanded to a lower court for reconsideration, and so the device makers are not off the hook just yet.

The court expressed quite a bit of ire over the handling of the case at the trial court, particularly regarding allegations the companies bribed the regime of Saddam Hussein in Iraq, but there were a few issues with paid witnesses that plaintiff’s attorneys had indicated were testifying without compensation. The outcome relieves the companies of a $151 million liability, which was itself a fraction of the $502 million originally arrived at in this case. The principle message to be learned from this outcome is that attorneys for plaintiffs can’t indulge in every whimsical allegation that comes to mind if they want these lawsuits to stay on an even keel.

FDA floats digital precert model

The precertification pilot program for software as a medical device drew raves from stakeholders when the FDA announced the program in September 2017, and the agency has now delivered on a draft working model of a full program. Whether developers see this as a hit or a miss might be conditional on several things, including whether the vendor has prior experience with device applications. The draft states that developers with previous experience in the device business will be subject to less scrutiny, something that information technology companies may see as discriminatory.

The precert concept relies on an organization’s demonstrated commitment to a culture of quality, but the agency said in a statement accompanying the draft working model that such a designation would mean that the organization in question “could potentially submit less information” on the product prior to going to market. The FDA addressed the question of third-party precertification with another response that amounts to “definitely maybe.” This uncertainty also underscored the agency’s remarks regarding whether certified sponsors will be subject to inspections, another conspicuous deviation from the precert pilot.

Opinions vary regarding whether this new paradigm for regulated software is as painless as some believe, given all the optimism surrounding the pilot. One regulatory attorney told a media outlet recently that the FDA document seems an implicit trade of faster times to market in exchange for more regulation. Regulatory attorney Bradley Merrill Thompson of Epstein Becker Green also said, “industry has to review this proposal with eyes wide open.”

In a somewhat related development, the FDA published a draft guidance for multiple function device products, and the Federal Register notice states that the FDA’s Bakul Patel is the contact point for the draft, making clear that this is principally about software devices and software functions that are secondary to the device primary function. Patel is the associate director for digital health at the agency’s device center, hence the authorship makes clear the focus of the draft despite that a device with no software at all could be a multi-function device.

The draft defines the term “function” as “a distinct purpose of the product,” but that distinct purpose could be a mere subset of the intended use or could make up the entire intended use. The most interesting part of the draft, which was made necessary by Section 3060 of the 21st Century Cures Act, is that it states that the “device function-under-review” will be the principle point of interest, although the agency will assess the impact of these other functions on the function under review, even when those other functions would otherwise enjoy enforcement discretion or would not be subject to regulation.

Sponsors will have to conduct a risk analysis of the potential impact of these non-reviewed functions on the function under review, but these non-reviewed functional aspects of the device won’t be subject to post-market surveillance activities. Still, device makers will have to document design considerations for non-reviewed functions, such as software architecture, as well as any relationships between the reviewed and non-reviewed functions, such as shared computational resources.

While the draft may be an improvement on regulatory silence on the matter, it would seem to raise the question of why the entirety of the Quality Systems Regulation is not applicable to a device function that is nonetheless subject to risk analyses and some of the more labor-intensive documentation requirements that fall under the QSR.

Massachusetts Says Brand Name Drug Manufacturers Are Not Liable for Generic Drugs, Except . . .  

Jordan Lipp | Attorney, Managing Member | Childs McCune

On March 16, 2018, the Massachusetts Supreme Court weighed in on the issue of whether a brand name drug manufacturer is liable for a plaintiff’s use of the generic form of the drug, and it reached a surprising result.  As discussed in the previous blog post on December 22, 2017, Conte on Steroids, most states conclude that a brand name drug manufacturer cannot be liable for damages caused by the generic version of the drug.  In a detailed analysis, the Massachusetts Supreme Court followed the vast majority of its sister courts, concluding that a brand name drug manufacturer cannot be held liable in product liability or negligence for a plaintiff who ingested the generic version.

But then, borrowing from case law involving such disparate subjects as landowner duties to trespassers and liability releases for sporting activities, the Massachusetts Supreme Court explained that “public policy is not served if generic drug consumers have no remedy for the failure of a brand-name manufacturer to warn in cases where such failure exceeds ordinary negligence, and rises to the level of recklessness.”  Rafferty v. Merck & Co., No. SJC-12347, 2018 Mass. LEXIS 161, at *29 (Mar. 16, 2018).  As such, the Court found that a brand name drug manufacturer can be liable for the generic version of the drug “where, for instance, a brand-name manufacturer learns that its drug is repeatedly causing death or serious injury, or causes birth defects when used by pregnant mothers, and still fails to warn consumers of this danger.”  Id. at *29-30 (Mar. 16, 2018).

The ramifications of this novel approach are significant.  Setting aside the fact that this decision comes from a court in one of the hubs of innovation in the life sciences, it is important to note that the decision is the very first of its kind.  No other court has determined to bar negligence claims yet permit reckless claims with regards to brand name drug liability resulting from generic use.  The Massachusetts Supreme Court even admits that it is “the only court” to make this distinction.  Id. at *32.

While this is a new issue in the context of drug and device litigation, other types of litigation shed light on what the repercussions of this decision may be.  As referenced above, this distinction of not permitting negligence claims but permitting reckless claims exists in the context of both sporting participants who have signed a release and trespassers who claim injury.  On one hand, the higher standards in these types of cases has discouraged lawsuits and made summary judgment easier for defendants to obtain.  On the other hand, requiring a plaintiff to meet a reckless standard certainly does not eliminate litigation.  And, depending upon the situation and insurance policy, the reckless standard can have serious insurance ramifications as some insurance policies do not cover reckless conduct.  The other question, of course, is whether courts in other jurisdictions may start to follow Massachusetts’ novel approach on brand name drug liability.

Regardless, for brand name drug manufacturers, it is a brave new world in Massachusetts.

Two Tales of Preemption

FDA preemption for medical devices is never out of the spotlight for long, even if the story usually seems unchanged by the latest retelling. One recent case confirms that success is sometimes measured in large part by the adversary’s miscues, but the other seems to break new ground in this area by posing the question of how preemption works when a PMA and a 510(k) device are joined. Perhaps as important, however, is that this second case portends a growing split in the courts on a central point in the preemption debate.

Alphatec Prevails in Sixth Circuit

Some preemption cases are a trial in more ways than one, but Alphatec Spine, Inc. prevailed fairly handily in a hearing of Agee v. Alphatec Spine in the U.S. Court of Appeals for the Sixth Circuit. The district court had dismissed the charges with prejudice despite allowing the plaintiff to amend the complaint, describing the plaintiff’s arguments as “a rambling, disorganized mess,” which consisted primarily of conclusory arguments that came up short of pleading standards under the Federal Rules of Civil Procedure 8 and 9.

The plaintiff seems to have compounded the problem by failing to directly respond to Alphatec’s argument regarding implied preemption during district court proceedings, taking up the subject only from the standpoint of doctrine. The plaintiff attacked express preemption at the district court stage, but Alphatec never raised express preemption. Also apparently unchallenged by the plaintiff was Alphatec’s argument that state law in Ohio bars common-law negligence claims.

The Sixth Circuit allowed the plaintiff to return to the district court to revisit the issue of whether the complaint met federal pleading standards, a move attributed to what is said to have been an abuse of discretion on the part of the district court judge. Nonetheless, the Sixth Circuit made clear it was unimpressed with more or less the entirety of the plaintiff’s handling of the matter, stating that the plaintiff’s failure to challenge the district court’s conclusions regarding preemption “fully determines this appeal inasmuch as the forfeited arguments encompass all of the plaintiffs’ causes of action.”

Preemption, PMAs and Predicate Devices

Express preemption might seem a largely settled matter thanks to Reigel v. Medtronic, but the recently decided case of Shuker v. Smith & Nephew took up the relatively novel predicament of a combination of both PMA and 510(k) devices. The outcome in this case in the U.S. Court of Appeals for the Third Circuit affirmed preemption for PMA devices, but seems to have created a schism with respect to the presumption against express preemption.

Shuker addresses a combination of devices that were not approved by the FDA in the configuration used by the implanting physician, and the plaintiff alleged the company’s literature had violated the law when it discussed the use of Smith & Nephew’s R3 acetabular cup in this configuration. The court received an amicus brief from the Department of Justice, which affirmed preemption for PMA devices even when attached to one or more 510(k) devices, but the Third Circuit seems to have sustained the possibility that Smith & Nephew’s printed material regarding the R3 could support a claim of misrepresentation. The Third Circuit sent that discussion back to the district court, which had dismissed that claim with prejudice.

While Shuker is a win for preemption, this appears to be the first instance in which an appeals court has undertaken the question of a device system bearing both 510(k) and PMA components. There is a novel source of tension in the decision, however, in that the court declared that the presumption against express preemption is still alive. The U.S. Court of Appeals for the Eight Circuit arrived at a different conclusion last year in Accord Watson v. Air Methods Corp., but the outcome in Shuker is based in part on the notion that what some believe is pertinent a Supreme Court precedent – that of Puerto Rico v. Franklin California Tax-Free Trust – is not applicable to the areas of the economy regulated by the FDA because Puerto Rico v. Franklin was directed toward bankruptcy law.

Consequently, the Third Circuit argued that the presumption against federal preemption is still a functioning legal theory, but attorneys for Medtronic might differ. The company won a case in the Arizona Supreme Court in October 2017, Conklin v. Medtronic, in which Judge Lori Bustamante declared that even though federal laws are not typically presumed to preempt state laws, the courts “do not invoke that presumption when the federal statute contains an express preemption clause.” Bustamante cited Puerto Rico v. Franklin in support of that conclusion.

It is predictably difficult to forecast how the presumption dilemma will unfold if only because a device maker will have to suffer an adverse outcome in a circuit court before the question is brought to the Supreme Court. On the other hand, there is clearly a growing trend toward differential outcomes on this point, which at the very least suggests the Supreme Court may find this a compelling problem should a device maker apply for cert.

Conte on Steroids — The California Supreme Court Finds that Novartis Can Be Liable for a Drug It Hasn’t Made in Years

Jordan Lipp | Partner, Davis Graham & Stubbs LLP

 

A basic premise of product liability law is that it is the manufacturer of a product, not its competitors, is the sole entity liable for the harm caused by its own defective product.  This issue is of particular importance in the context of brand name versus generic drug manufacturers.  Courts throughout the nation have faced the question of whether the manufacturer of a name brand version of a drug is liable to a plaintiff who only took the generic version of the same drug.  The overwhelming precedent, with a handful of exceptions, has been that a name brand manufacturer cannot be liable if the plaintiff consumed a generic version of the drug.  One of those handful of exceptions was Conte v. Wyeth, a 2008 decision from the California Court of Appeals, which held that a brand name drug manufacturer has a duty to warn the prescribers of the generic versions of their drug.

On December 21, 2017, the California Supreme Court rejected the overwhelming precedent from other states, and following the Conte decision.  It held that brand name drug manufacturers have a duty to warn about their drugs, regardless of whether the plaintiff used the brand-name or generic version of the drug, so long as the plaintiff relied upon the brand name drug manufacturer’s warning.

Perhaps even more surprising was the California Supreme Court’s holding that the brand-name manufacturer’s sale of the rights to the drug did not terminate its liability.  The case, T.H. v. Novartis Pharmaceuticals Corp., — P.3d —,  2017 WL 6521684 (Cal. 2017), arose from a claim by two children (through their guardian ad litem) that their developmental delays and autism were caused by their mother’s use of terbutaline in 2007 during her pregnancy with them.  The brand name version of terbutaline is Brethine, which was manufactured by Novartis until 2001.  In 2001, six years before the generic version of the drug was actually used, Novartis sold its rights to the brand name drug to another drug company.

In spite of the facts that (1) the plaintiffs’ mother took the generic drug, not the brand name drug, and (2) when the mother took the generic drug, Novartis no longer held the rights to the brand-name equivalent, the California Supreme Court still found that Novartis could be liable.  On the first issue, the California Supreme Court held that “Because the same warning label must appear on the brand-name drug as well as its generic bioequivalent, a brand-name drug manufacturer owes a duty of reasonable care in ensuring that the label includes appropriate warnings, regardless of whether the end user has been dispensed the brand-name drug or its generic bioequivalent.”  On the second issue, the Court found that “If the person exposed to the generic drug can reasonably allege that the brand-name drug manufacturer’s failure to update its warning label foreseeably and proximately caused physical injury, then the brand-name manufacturer’s liability for its own negligence does not automatically terminate merely because the brand-name manufacturer transferred its rights in the brand-name drug to a successor manufacturer.”

Well aware that this decision runs contrary to the great weight of authority in other states, the California Supreme Court ended its opinion stating: “We do not doubt the wisdom of crowds in some settings. But the value of an idea conveyed by or through a crowd depends not on how loudly it is proclaimed or how often it is repeated, but on its underlying merit relative to the specific issue at hand.”  With this decision, California will continue to be a hotbed for pharmaceutical litigation for years to come.

Status of Medical Device Reprocessor/Refurbisher Liability

Courtney S. Young, Esq. |Senior Attorney, Medmarc Risk Management

Status of Reprocessor Liability

The recent pressures to drive down the cost of medical care have given way to a practice of using medical devices (even so-called “single-use devices”) a greater number of times, on a greater number of patients, before disposing of them. To accomplish this, hospitals are increasingly using reprocessors to sterilize and re-validate their devices between uses. Although device reprocessing is nothing new, the increase in demand has largely altered the general practice from one in which hospitals sent its devices to a reprocessor and got those exact units back after reprocessing, to one in which the reprocessor provides the hospital with the same model of devices that the hospital submitted but not necessarily the same specific units submitted. This allows for a faster turn-around time.  In this process, the reprocessor may often re-serialize the devices and alter the labels, warnings, or instructions for use, hopefully to account for any additional precautions medical personnel must need to take in light of the manner of reprocessing.

FDA Regulation

Medical device refurbishing is an interesting area right now as it has recently become a focus for FDA and a potential subject of new regulation. Last Spring, the FDA sought industry feedback on proposed definitions including repair, refurbish, remanufacture, recondition, and remarket. At the same time, the Agency also solicited answers to questions about the risks and failure modes introduced as a result of performing these activities on medical devices, and whether the risks were different depending on who performs the activities (hospitals, OEMs, third parties). Thus far, though over 200 comments were submitted in response to these questions, there has not been any further movement from the FDA in this area. Many have speculated that when the Agency does take action, it will likely be to bring refurbishers under the same oversight scheme as reprocessors of single-use devices.

Kapps v. Biosense Webster, Inc.

Although the presence of reprocessors in the chain of distribution presumably has products liability implications for the original-equipment manufacturers (OEMs), few cases have addressed the issue of strict products liability for manufacturers when a device malfunctions after it has been reprocessed or refurbished. The most recent case that really explored this issue was Kapps v. Biosence Webster, 813 F.Supp.2d 1128 (D.Minn. 2011), a case that came out of the Federal District Court of Minnesota in 2011. Though several years old now, the Court’s analysis provides some valuable insights into distinctions that may be important in deciphering products liability apportionment between OEMs and reprocessors. It’s easy to extrapolate that similar reasoning would apply to refurbishers.

In Kapps, the plaintiff was an atrial fibrillation patient that underwent a procedure in which doctors used a “lasso catheter” that had been reprocessed.  During the surgery, the lasso portion of the catheter separated and remained entangled in the plaintiff’s mitral valve. It was eventually able to be removed by the doctors, but the damage that was sustained to the plaintiff’s mitral valve in the process necessitated additional open-heart surgery and replacement of his damaged valve with a prosthesis.

The plaintiff brought the usual products liability claims—manufacturing defect, warning defect, design defect, breach of warranty, and negligence—against both the OEM and the reprocessor.

The Court held:

  1. Plaintiff cannot rely on res ipsa loquitor to establish the OEM’s liability for manufacturing defects.

Res ipsa loquitur is a doctrine used in negligence and products liability actions when the plaintiff has incurred some harm, but obvious difficulties may make too difficult for the plaintiff to prove the exact origin of the cause of harm. In order to utilize res ipsa, plaintiffs (generally) must first establish both that (1) the accident—here, the defect in the product—is the kind that would usually be caused by negligence; and (2) that the defendant had exclusive control over the instrumentality that caused the accident—here, the manufacture and composition of the device.  In disallowing the plaintiff to rely on res ipsa against the OEM, the Court relied on the fact that at the time of injury, the reprocessed device could not be said to have been in the same condition it was when it left the OEM’s control. In effect, the second prong was not satisfied as the OEM did not have exclusive control over the condition of the catheter once the reprocessor was used.

  1. Claims against the reprocessor are viable under theory of res ipsa loquitor.

In contrast, because the reprocessor did have exclusive control over the condition of the catheter as it was at the time of the injury, the Court held that res ipsa loquitur could be applied to the negligence claim against the reprocessor.

  1. An OEM that markets its device as single use will be immunized against the claim that it nonetheless should have foreseen and warned that a reprocessor might ignore the single-use instructions.

In Kapps, the OEM of the catheter has specifically labeled the device, and included in its instructions for use, that it was intended for single use only. Nonetheless, the plaintiff claimed that the OEM should have foreseen that the catheter would likely still be reprocessed despite such instructions, and warned accordingly of the dangers of reprocessing. The Court rejected this claim.

  1. Reprocessor carried a manufacturer’s duties to warn and to provide a defect-free product, because it acted (a) replaced the OEM’s instructions for use and product serial numbers with its own; (b) warranted the functionality of the reprocessed device; and (3) marketed the product as its own equivalent to the OEM’s.

The reprocessor responded to the warning-defect allegations of the plaintiff’s by asserting that the duty to warn should lie only with the OEM. The Court did not find this argument compelling, and instead held that the reprocessor in these circumstances indeed had the same duty to warn as an OEM has.

Kapps can provide helpful guidance for OEMs and reprocessors alike.  For OEMs, it may be reassuring that they may not be strictly liable for manufacturing defects after the their device has been reprocessed, but they must be careful to include warnings and instructions for reprocessing and its dangers if in fact their device is not designated for single use only. Reprocessors should be mindful of enlarging their own products liability when they mix, re-serialize, and alter the warnings and labels of an OEM’s devices.

State Statutes

In the years since Kapps, courts haven’t been asked to reconsider the issue of reprocessor/refurbishers liability hasn’t come before the courts again, so it’s the best indication we’ve got as to how courts are likely to treat reprocessor liability going forward. That said, several states aren’t waiting for the courts to decide, and some have enacted statutes specifically deeming reprocessors and refurbishers to have the same liability with respect to a defective device as original manufacturers. See, e.g., Utah’s statute, U.C.A. 1953 § 78B-4-505. Liability of reprocessor of single-use medical devices.

Conclusion

The safest course for reprocessors and refurbishers of medical devices is probably to assume that they may stand in the shoes of the OEM if something goes wrong with the device they process. In doing so, they should implement a quality management system and undertake the same robust risk management practices of which successful OEMs make use.

Venue, Preemption Issues Dot Legal Landscape

The Supreme Court has been busy of late on several fronts of interest to those in the life sciences, and may be busier yet if it accepts a case dealing with preemption. The Court decided a case recently dealing with venue, but there is some disagreement as to how much that decision clarified the questions at hand.

Is Lohr back in play?

Those who find the PMA preemption discussion fascinating will enjoy the potential for a reexamination of preemption for class II devices if the U.S. Supreme Court grants cert for a case addressing surgical meshes. One of the more interesting aspects of this case is that any push for 510(k) preemption might be due to more stringent requirements for these applications imposed by the FDA over the past few years.

J&J subsidiary Ethicon requested cert for Ethicon v. Huskey, which takes up a synthetic surgical mesh applied for stress urinary incontinence. The jury trial returned an award of more than $3 million for the plaintiff, and Ethicon appealed the case on the grounds that the judge in the first trial disallowed evidence as to the company’s adherence to FDA premarket requirements, along with several other bits of regulatory information related to the device.

The appeals court sided with the district court, citing with the Federal Rule of Evidence 403 as justification for omitting the evidence in question, but the appeals court decision also argued that 510(k) filings only “tangentially” deal with safety and efficacy. The court cited Medtronic v. Lohr without comment in this section, which seems likely to provoke a discussion as to whether the FDA’s increasing demands from FDA for 510(k) filings begins to approach the threshold for specificity that is the foundation for PMA preemption. Or at least that’s the argument device makers are inclined to make.

Either way, Lohr dealt with the statute as it existed in 1982, when the FDA cleared the Model 4011 pacemaker, and thus changes imposed by Congress since then, including the Safe Medical Devices Act of 1990, were not considered. This legislation was driven almost entirely by concerns about the tracking of adverse events for class II devices, but the Supreme Court decision in Lohr claimed that a typical 510(k) review takes only 20 hours as opposed to the average of 1,200 hours needed to review a PMA filing.

Whether those times still hold is difficult to know, but the most recent FDA performance report for the soon-to-expire device user fee agreement suggests that overall PMA review times are down to 163 FDA days while the target for 510(k) review times is still 90 FDA days. The question one might ask oneself is: If it takes the FDA 90 days to get through 20 hours of review time for a 510(k), how can it take only 163 days to put 1,200 hours into a PMA?

Venue, vidi, vici

Those who see the question of forum shopping in a negative light might be encouraged by a recent decision in the Supreme Court that seems to put the clamps on this practice. The fact that the decision in Heartland v. Kraft was unanimous would seem to bring the venue question to a thunderous close, but there is some skepticism as to whether the question is fully answered.

Justice Clarence Thomas wrote the 8-0 decision in Heartland  – Justice Neil Gorsuch did not take part – and said that §1400 of Title 21 of the U.S. Code was unaffected by congressional modification of Title 21’s §1391. Thomas also pointed to Fourco Glass v. Transmirra Products, the 1957 case in which the Supreme Court declared that the word “resides” means the location of incorporation for a U.S. domestic company.

Former PTO director Todd Dickinson noted that the outcome leaves a few questions unanswered about cases that are already in process, but he also said that stand-alone legislation by Sen. Jeff Flake (R-Ariz.) directed toward venue might be futile. On the other hand, former Senate Judiciary Committee chairman Orrin Hatch said he will draft a bill to take up the vexatious venue problem, so there is clearly some interest on Capitol Hill.

There are those who believe that Heartland might influence whether patent litigants will resort to multidistrict litigation to go after infringers. The America Invents Act disallowed the use of joinder based merely on the charge that each of the named defendants infringed the same patent, and Heartland would seem to suggest that a patent holder will spend a lot more time on the road in pursuit of damages, although a lot of potential targets are located in Delaware thanks to that state’s status as the home of the limited liability corporation.

Multidistrict litigation might seem a handy way to pursue infringers in numerous jurisdictions, but MDLs are infrequently used for patent cases. Would the U.S. Judicial Panel on Multidistrict Litigation (JPML) be persuaded by an application to consolidate patent lawsuits when only half a dozen or so defendants are named? By some accounts, patent MDLs currently account for less than 5 percent of all MDLs, although this might reflect nothing more than underutilization.

Still, it seems plausible that a plaintiff will have to identify a very similar set of allegations for a given number of defendants in order to prod the JPML into action. A lack of sheer numbers presents one problem, but the combination of small numbers and dissimilar allegations could prove fatal to an effort to consolidate patent lawsuits via the JPML.

U.S. Supreme Court Clamps Down on Mass Tort State Court Lawsuits

Jordan Lipp | Partner, Davis Graham & Stubbs LLP

Yesterday morning, in an 8-1 decision, the United States Supreme Court determined that plaintiffs who did not reside in California could not sue Bristol-Myers Squibb in California.  The decision is the latest one in a string of decisions from the United States Supreme Court, which are limiting the scope of personal jurisdiction – i.e., where a company can get sued.  The question of where a company can or cannot get sued is one of the most important issues in defending lawsuits against life science companies.  And this lawsuit is a classic example of these issues.

As discussed more in earlier blog posts as we’ve followed this litigation, this appeal involved personal jurisdiction issues in a case where 678 individuals, consisting of 86 California residents and 592 nonresidents, all alleged adverse consequences from the use of Bristol-Myers Squibb’s drug Plavix.  Bristol-Myers Squibb is incorporated in Delaware, headquartered in New York City, with substantial operations in New Jersey.  The lawsuits were filed in San Francisco Superior Court.  Bristol-Myers Squibb challenged the jurisdiction of California courts to hear the claims of plaintiffs who did not reside in California.  While the California Supreme Court found there was no general jurisdiction (i.e., whether a defendant can be sued in the forum regardless of whether the case is related to the forum), the California Supreme Court found that there was specific jurisdiction (i.e., case-linked jurisdiction) due to Bristol-Myers Squibb’s “wide ranging” contacts with California.

Yesterday, the United States Supreme Court reversed the California Supreme Court.  As “the nonresidents were not prescribed Plavix in California, did not purchase Plavix in California, did not ingest Plavix in California, and were not injured by Plavix in California,” the United States Supreme Court Court found specific jurisdiction lacking.  Specific jurisdiction in these circumstances is absent no matter how many other connections Bristol-Myers Squibb had to California, no matter how many California residents had sued Bristol-Myers Squibb for the same conduct in California, and no matter how efficient having combined litigation  in California might be.  While hardly a surprising ruling, this decision could have far reaching consequences in large-scale drug and device litigation.  While a drug or device company can be sued in the state in which it is headquartered or incorporated (i.e., the concept of general jurisdiction), it will be much harder for plaintiffs to sue drug and device companies in any other plaintiff-friendly jurisdictions.  Rather, this Bristol-Myers Squibb decision will continue the trend in confining plaintiffs to suing drug and device company only in their own home-state, or where the drug or device company is headquartered / incorporated.