United States District Court, D. Arizona
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[Copyrighted Material Omitted]
For Cristina Ramirez, Plaintiff: Cecilia Han, Kent L Klaudt, Lisa J Cisneros, LEAD ATTORNEYS, Lieff Cabraser Heimann & Bernstein LLP - San Francisco, CA, San Francisco, CA; Michael P Stark, LEAD ATTORNEY, Stark Williamson & Clausen LLP, Phoenix, AZ; Wendy R Fleishman, LEAD ATTORNEY, Lieff Cabraser Heimann & Bernstein LLP, New York, NY.
For Medtronic Incorporated, a Minnesota corporation, Medtronic Sofamor Danek USA Incorporated, Defendants: Michael Kevin Brown, LEAD ATTORNEY, Reed Smith LLP, Los Angeles, CA; Stephen M Bressler, LEAD ATTORNEY, Lewis & Roca LLP, Phoenix, AZ; Kathleen Kelly Kahn, Lewis & Roca LLP - Phoenix Office, Phoenix, AZ.
G. Murray Snow, United States District Judge.
Defendants Medtronic Inc. and Medtronic Sofamor Danek USA Inc. move to dismiss the Complaint filed by Plaintiff Cristina Ramirez. (Doc. 24.) The briefing on that Motion has also produced a Motion to Strike. (Doc. 37.) The Court held oral argument on August 13, 2013. For reasons discussed below, the Court grants in part and denies in part both Motions.
Ramirez has brought several tort claims against Medtronic that challenge how Medtronic has produced and promoted its Infuse device. Ramirez underwent a lumbar fusion procedure to alleviate her back pain on March 2, 2009. (Doc. 1 ¶ 246.) Her surgeon, Dr. Wang, used Infuse, a bio-engineered liquid bone graft substitute, during the procedure. ( Id. ¶ ¶ 1, 246.)
Infuse is one of Medtronic's products. ( Id. ¶ 2.) Its purpose is to " foster fusion between the vertebrae without implanting a patient's own bone or cadaver bone between the vertebrae in the spine, obviating the necessity of harvesting bone from the patient's own hip or risking rejection of cadaver bone." ( Id. ) The Infuse device consists of three components: (1) a metallic spinal fusion cage (the LT-Cage), (2) the bone graft substitute, which consists of liquid rhBMP-2, and (3) a spongy carrier or scaffold for the protein that resides in the fusion cage. ( Id. ¶ 56.) During surgery, the doctor attaches the fusion cage to the diseased spinal region to stabilize the area, soaks the collagen sponge with the rhBMP-2, and applies it to the diseased region. ( Id. ¶ ¶ 57-59.) In time, the sponge dissolves while the rhBMP-2 stimulates the spinal cells to grow new bone in place of the diseased area. ( Id. )
Infuse is a Class III device under the Medical Device Amendments of 1976 (MDA), which updated the Food, Drug, and Cosmetic Act of 1938 (FDCA). ( Id. ¶ 64.) A Class III device poses the highest level of risk and consequently receives the highest level of regulatory scrutiny before marketing. See 21 U.S.C. § § 360c, 360e. A major aspect of that scrutiny is the Premarket Approval Application (PMA) that a manufacturer of a Class III device must submit to the FDA prior to distribution and marketing. See id. Among other things, the application must specify the " intended use" of the product. Id. § 360e(c)(2)(A)(iv). The FDA then analyzes studies and data to measure the safety and effectiveness of the device for that use. See id. § 360e(c).
Medtronic submitted a PMA to the FDA for Infuse on January 12, 2001. (Doc. 1 ¶ 70.) Infuse was intended for a single-level anterior lumbar interbody fusion performed with all three components in a specific spinal region. ( Id. ¶ ¶ 72-74.) On July 2, 2002, the FDA approved Infuse to treat degenerative disc disease in the procedure specified by Medtronic. ( Id. ¶ 73.) With the exception of two non-spinal uses not relevant here, the FDA has never approved any other use of Infuse, including the posterior approach used on Ramirez.  ( Id. ¶ ¶ 72, 76-77.) The FDA was concerned about the potential adverse effects, such as bone overgrowth, that occurred when Infuse was used in posterior procedures. ( Id. ¶ ¶ 79-86.) Despite the limited nature of the FDA's approval of Infuse, physicians are free to use FDA-approved medical devices either " on-label" (in accordance with the FDA approval) or " off-label" (for other uses). ( Id. ¶ 78.)
Off-label uses of Infuse by physicians made up close to 90% of the $800 million dollars in revenue that Infuse generated in 2011. ( Id. ¶ ¶ 126-30.) Medtronic allegedly promoted those off-label uses through its sales personnel and by establishing consulting/royalty agreements with physicians who advocated off-label uses to fellow surgeons. ( Id. ¶ ¶ 131-32, 136-40, 166-71.) Yet Medtronic knew a number of studies showed that off-label use of Infuse often produced severe side effects. ( Id. ¶ ¶ 87-125.) Medtronic allegedly tried to conceal these risks by funding biased studies and articles by opinion leaders in key medical journals that showed a lower incidence of off-label adverse effects. ( Id. ¶ ¶ 113, 131-32, 136-40, 172-214.) In addition, Medtronic allegedly failed to report certain adverse events to the FDA. ( Id. ¶ ¶ 28, 112, 147-49, 166q, 224, 228, 245, 355.)
These activities (or lack thereof) have produced litigation with private parties and the federal government, and also resulted in significant media coverage in outlets like the Wall Street Journal and New York Times. ( Id. ¶ ¶ 133, 151-71, 178-97.) A few Senators have initiated investigations into Medtronic's promotion and marketing of Infuse. ( Id. ¶ ¶ 215-31, 239-42.) In addition, a recent issue of The Spine Journal focused on the " serious patient safety and ethical concerns related to the use of rhBMP-2 (Infuse® ) in the spine." ( Id. ¶ 232.) These articles questioned the accuracy of previous Medtronic-sponsored trials and studies that showed a far lower incidence of adverse effects. ( Id. ¶ ¶ 232-38.)
The Complaint alleges that Medtronic's aggressive promotion of Infuse's off-label uses and obfuscation of the true risks has led to widespread acceptance among spinal
surgeons of such uses. ( Id. ¶ ¶ 245.) These surgeons--including Dr. Wang, who was a paid Medtronic consultant  and used Infuse in an off-label manner with Ramirez--were unaware of the serious risks that off-label use entailed. ( Id. ¶ 252.) When Dr. Wang performed Ramirez's lumbar fusion operation, he used only the rhBMP-2 bone graft component of the Infuse device and employed a posterior approach. ( Id. ¶ 246.) Dr. Wang did not use the other components of the Infuse device. ( Id. ) At the time of the procedure, Ramirez and her doctor were unaware of the true incidence of certain side effects that appear when Infuse was used in this manner. ( Id. ¶ 247.)
Ramirez began experiencing severe pain after surgery and later discovered that she had developed uncontrolled bone growth in the area where her surgeon had implanted Infuse. ( Id. ¶ ¶ 248-49.) The pain she experienced resulted from nerve impingement caused by the bone overgrowth. ( Id. ) Her pain has significantly disrupted her life. ( Id. ¶ ¶ 254-56.)
Ramirez brought suit against Medtronic on March 11, 2013, on the basis of diversity jurisdiction. She asserts six causes of action against Medtronic that arise out of state law: fraudulent misrepresentation/fraud in the inducement, failure to warn, defective design, misrepresentation, negligence, and breach of express warranty. ( Id. ¶ ¶ 264-349.) Medtronic has moved to dismiss the Complaint in its entirety. (Doc. 24.) Both Parties have submitted lengthy Requests for Judicial Notice. (Docs. 25, 32.) Medtronic has moved to strike Ramirez's Request. (Doc. 37.) The Court has also reviewed the several Notices of Supplemental Authority filed by the Parties. (Docs. 40, 41, 43, 45, 46.)
I. MOTION TO STRIKE
Ramirez filed a Request for Judicial Notice that contains letters from four Senators, a Senate committee staff report, the FDA-approved label for Infuse, and a series of court decisions. (Doc. 32.) The general rule that a court may not consider evidence or documents beyond the complaint in the context of a Rule 12(b)(6) Motion to Dismiss has two exceptions. First, a court may consider documents " whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the [plaintiff's] pleading," Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005) (alteration in original). Second, a court may take judicial notice of " matters of public record outside the pleadings." Mack v. S. Bay Beer Distribs., Inc., 798 F.2d 1279, 1282 (9th Cir. 1986), overruled on other grounds by Astoria Fed. Sav. & Loan Ass'n v. Solimino, 501 U.S. 104, 111 S.Ct. 2166, 115 L.Ed.2d 96 (1991). While matters of public record, such as prior court proceedings, are proper subjects of judicial notice, a court may take notice only of the authenticity and existence of a particular order or pleading, not the veracity or validity of its contents. Lee v. City of Los Angeles, 250 F.3d 668, 690 (9th Cir. 2001); Walker v. Woodford, 454 F.Supp.2d 1007, 1022 (S.D. Cal. 2006), aff'd in part, 393 Fed. App'x 513 (9th Cir. 2010). Even when considering a public record, however, judicial notice is limited to those facts that are " not subject to reasonable dispute." Fed.R.Evid. 201(b).
Thus the Court can properly take judicial notice of the FDA-approved label. It is a matter of public record and there is no dispute between the Parties about its authenticity. See In re Epogen & Aranesp Off-Label-Mktg. & Sales Practices Litig., 590 F.Supp.2d 1282, 1286 (C.D. Cal. 2008) (taking judicial notice of FDA label). As to the remaining documents, the Court takes judicial notice of their authenticity and existence, but not the validity of the allegations or claims made therein. To the extent Ramirez seeks to rely on those documents for the validity of their contents, the Motion to Strike is granted. In any event, the contents of those documents have no bearing on the issues presented by Medtronic's Motion. Moreover, any relevant content alleged through Ramirez's Complaint is taken as true at this point in the litigation, including allegations that Medtronic promoted Infuse for off-label use. The Motion consequently has little bearing on the decision here.
II. MOTION TO DISMISS
A. Legal Standard
Rule 12(b)(6) is designed to " test the legal sufficiency of a claim." Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). To survive dismissal for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6), a complaint must contain more than " labels and conclusions" or a " formulaic recitation of the elements of a cause of action" ; it must contain factual allegations sufficient to " raise a right to relief above the speculative level." Bell A. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). While " a complaint need not contain detailed factual allegations . . . it must plead 'enough facts to state a claim to relief that is plausible on its face.'" Clemens v. DaimlerChrysler Corp., 534 F.3d 1017, 1022 (9th Cir. 2008) (quoting Twombly, 550 U.S. at 570). " A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Twombly, 550 U.S. at 556). Plausibility requires " more than a sheer possibility that a defendant has acted unlawfully." Twombly, 550 U.S. at 555. Accordingly, a plaintiff must do more than employ " labels," " conclusions," or a " formulaic recitation of the elements of a cause of action." Id.
When analyzing a complaint for failure to state a claim under Rule 12(b)(6), " [a]ll allegations of material fact are taken as true and construed in the light most favorable to the nonmoving party." Smith v. Jackson, 84 F.3d 1213, 1217 (9th Cir. 1996). However, legal conclusions couched as factual allegations are not given a presumption of truthfulness, and " conclusory allegations of law and unwarranted inferences are not sufficient to defeat a motion to dismiss." Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998).
When a plaintiff like Ramirez alleges that a defendant has committed fraud, the Federal Rules deploy a heightened pleading requirement: " In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally." Fed.R.Civ.P. 9(b). Under this rule, a plaintiff " must state the time, place, and specific content of the false representations as well as the identities of the parties to the misrepresentation." Schreiber Distrib. Co. v. ServWell Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986); see also Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (" Averments of fraud must be
accompanied by the who, what, when, where, and how of the misconduct charged." (internal quotation marks omitted)).
" To allege fraud with particularity, a [claimant] . . . must set forth an explanation as to why the statement or omission complained of was false or misleading." In re GlenFed, Inc. Sec. Litig., 42 F.3d 1541, 1548 (9th Cir. 1994). Falsity may be established through inconsistent contemporaneous statements or information made by or available to the defendants, but such statements are not required. Id. at 1549. Falsity may also be established through allegations of circumstantial evidence. See Cooper v. Pickett, 137 F.3d 616, 625 (9th Cir. 1997).
B. The MDA and Preemption
Medtronic's chief contention is that Ramirez's common law claims are preempted under the MDA and FDCA.
1. The MDA
Prior to the passage of the MDA, " the introduction of new medical devices was left largely for the States to supervise as they saw fit." Riegel v. Medtronic, Inc., 552 U.S. 312, 315-16, 128 S.Ct. 999, 169 L.Ed.2d 892 (2008). But in 1976, Congress responded to concerns about device safety " with passage of the [MDA], which swept back some state obligations and imposed a regime of detailed federal oversight." Id. The MDA created three categories of devices, each to receive an increasing level of regulatory scrutiny. As discussed above, Infuse is a Class III medical device, which means that a less stringent classification would not provide sufficient assurance of safety and effectiveness, and Infuse 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." 21 U.S.C. § 360c(a)(1)(C)(ii).
As a Class III device, Infuse endured the " rigorous" PMA process as the FDA conducted a comprehensive examination of the device. Medtronic, Inc. v. Lohr, 518 U.S. 470, 477, 116 S.Ct. 2240, 135 L.Ed.2d 700 (1996); Riegel, 552 U.S. at 317-18; see generally 21 U.S.C. § 360e(c)(1); 21 C.F.R. § 814.20. Nevertheless, the FDA's detailed safety and effectiveness evaluation is strictly tied to the manufacturer's intended use of the device. 21 U.S.C. § 360c(a)(2). The FDA looks only at the " safety and effectiveness of a device . . . with respect to the persons for whose use the device is represented or intended, with respect to the conditions of use prescribed, recommended, or suggested in the labeling of the device, and weighing any probable benefit to health from the use of the device against any probable risk of injury or illness from such use." Id. Thus the FDA looks at the use of a device within the parameters defined by the manufacturer. See id.; id. § 360e(c)(1) (describing how the Secretary can deny approval based on the safety and effectiveness of the device " under the conditions of use prescribed, recommended, or suggested in the proposed labeling thereof" ).
As discussed above, Medtronic submitted Infuse to the FDA for use in a single-level anterior lumbar interbody fusion performed with all three components in a specific spinal region. (Doc. 1 ¶ ¶ 72-74.) Accordingly, the FDA's premarket review focused exclusively on the safety and effectiveness of Infuse for that use. See 21 U.S.C. § § 360c(a)(2), 360e(c)(1). And when the FDA approved Infuse on July 2, 2002, the FDA approved Infuse to treat degenerative disc disease in the procedure defined by Medtronic, and only in that manner. ( Id. ¶ ¶ 72-73, 76-77.)
Once a manufacturer has specified and the FDA has approved the device for the intended use, the FDA takes substantial control of how the manufacturer designs, manufactures, labels, and markets the device going forward--the MDA prohibits any unilateral " changes in design specifications, manufacturing processes, labeling, or any other attribute, that would affect safety or effectiveness." Riegel, 552 U.S. at 319 (citing 21 U.S.C. § 360e(d)(6)(A)(i)). A manufacturer is further prohibited from promoting a use of the product that is not the specified use. 21 U.S.C. § 331(a); see also 21 C.F.R. § 814.80 (providing that a " device may not be . . . advertised in a manner that is inconsistent with any conditions to approval specified in the PMA approval order for the device." ). A manufacturer who wishes to modify the labeling, packaging, design, or indications for use of its device has to comply with a supplemental PMA process. 21 C.F.R. § 814.39(a). The statute also subjects approved devices to reporting requirements. 21 U.S.C. § 360i. For example, the manufacturer must update the FDA when it learns of investigations or scientific studies concerning its device, 21 C.F.R. § 814.84(b)(2), or incidents where the device--used in any manner--" [m]ay have caused or contributed to a death or serious injury," either due to malfunction or normal operation, id. § 803.50(a). The FDA can revoke its approval based on these post-approval reports. 21 U.S.C. § § 360e(e)(1), 360h(e).
In short, the FDA strictly regulates manufacturers based on the intended use of the device, and manufacturers can deviate from those specifications only with permission.
Congress also provided a measure of protection for medical device manufacturers. It employed its power to preempt state laws that impose on a regulated device " any requirement . . . which is different from, or in addition to, any requirement applicable under this chapter to the device . . . ." Id. § 360k(a). This express preemption provision allows manufacturers to avoid having their devices subject to overlapping and conflicting requirements. Common-law causes of action qualify as state requirements for purposes of the preemption statute because they impose standards of conduct on manufacturers that could potentially differ from those set by the FDA. See Riegel, 552 U.S. at 323-24; Lohr, 518 U.S. at 512 (plurality op. of O'Connor, J.); id. at 503-05 (Breyer, J., concurring). Accordingly, where the federal government has approved the product for a specific use and set forth specific regulations, manufacturers need only worry about complying with those regulations. State law cannot force manufacturers to do anything more than or different from federal law.
The statute thus requires a two-part inquiry to determine whether a state law claim is preempted. Has the federal government established requirements applicable to the device? And if so, do the plaintiff's state common-law claims require the manufacturer to do something " different from, or in addition to" those requirements imposed by the federal government? An affirmative answer to both leads to preemption. Riegel, 552 U.S. at 321-22. Consequently, any claim that a device " violated state tort law notwithstanding compliance with the relevant federal requirements" is expressly preempted. Id. at 330. And so § 360k generally shields a manufacturer from liability under state tort law so long as the manufacturer complies with federal law. See, e.g., Hughes v. Boston Scientific Corp.
, 631 F.3d 762, 767
(5th Cir. 2011); Bausch v. Stryker Corp., 630 F.3d 546, 549-50 (7th Cir. 2010).
In addition, state law claims that seek only to enforce federal law, nothing more, are impliedly preempted. Buckman Co. v. Plaintiff's Legal Comm., 531 U.S. 341, 344, 121 S.Ct. 1012, 148 L.Ed.2d 854 (2001). Claims premised solely on violations of the FDCA or MDA are preempted because " the federal statutory scheme amply empowers the FDA to punish and deter fraud against the Administration, and . . . this authority is used by the Administration to achieve a somewhat delicate balance of statutory objectives." Id. at 348; see also id. at 349 (citing statutory provisions that enable the FDA to investigate fraud and seek appropriate civil and criminal relief). The FDCA places enforcement of its provisions in the hands of the government, not private plaintiffs: an action for " enforcement, or to restrain violations, of th[e] [FDCA] shall be by and in the name of the United States." 21 U.S.C. § 337(a). To allow a private party to essentially enforce the FDCA through state law would upset the balance of objectives the FDA strives to maintain. Buckman, however, limited implied preemption to cases where the claim arises " solely ...