Drug & Device News

Plaintiffs contended that Wyeth and the other defendants unlawfully marketed the drug for off-label uses and actively hid from health care providers the dangers associated with it, through means such as failing to provide their health care providers with the required warning literature in the form of a “Medication Guide.” In total, the plaintiffs asserted eight state-law causes of action, including for strict liability-failure to warn, negligence-failure to warn, fraud and deceit, etc.

The defendants removed some of the causes of action from state to federal court. To keep these causes of action in federal court the defendants needed to show that they were either brought under federal law or that, although they were brought under state law, the claims necessarily raised “a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionally approved balance of federal and state judicial responsibilities.” See Gunn v. Minton, 568 U.S. 251 (2013).

The defendants first asserted the claims were inherently federal in nature, despite the fact that the plaintiffs had pleaded them as state law claims, because each relied on and expressly referenced the federal Food Drug and Cosmetic Act (FDCA) and its implementing regulations. Specifically, defendants pointed to plaintiffs' allegations that they: 1) violated the FDCA and its implementing regulations governing Medication Guides; and 2) violated the FDCA by promoting off-label uses of amiodarone hydrochloride. However, the court sided with the plaintiffs, noting that when a plaintiff seeks relief under state law, even repeated references to federal law will not render the cause of action one “arising under” federal law.

Moving on to the question of whether federal issues within the state law claims meant those claims were properly within the jurisdiction of the federal court, the court turned to the U.S. Supreme Court's Gunn decision for guidance. In Gunn, the Court said federal jurisdiction will lie where a state law claim raises a federal issue that is “(1) necessarily raised, (2) actually disputed, (3) substantial, and (4) capable of resolution in federal court without disrupting the federal-state balance approved by Congress.” See Gunn, 568 U.S. at 258.

The court then went through the four Gunn elements, beginning with whether federal issues were “necessarily raised” in the Streed plaintiffs' claims. For this, the question was whether federal law is a necessary element of the state law claim; in other words, if the state law claim can be supported by an alternative theory not dependent on the federal law, then the defendant cannot prove this first Gunn element. See Rains v. Criterion Sys., Inc., 80 F.3d 339, 346 (9th Cir. 1996). Here, the court held the defendants failed to prove the element because “plaintiffs allege claims for strict products liability, negligence, fraud, and wrongful death, as well as claims under California's Unfair Competition Law (UCL) and Consumer Legal Remedies Act (CLRA), each of which can be supported by a theory independent of any violation of federal law or regulation.”

The defendants did meet their duty to show the “actually disputed” element because the parties disagreed as to the interpretation of the regulation governing distribution of Medication Guides ( 21 C.F.R. § 208.24).

For the third element — substantiality of the federal issue within the state law claim — the court quoted Gunn once more for its teaching that “it is not enough that [the issue] be significant to the particular parties in the immediate suit”; rather, the issue must be important “to the federal system as a whole.” See Gunn, 568 U.S. at 260. So, if the plaintiffs were challenging the federal statutes and rules in question in and of themselves, the third element might be met. However, the Streed court determined that the plaintiffs were challenging only the behavior of the defendants (failing to distribute the Medication Guides as required, promoting off-label uses of drugs) and not the validity of the FDA's actions, the FDCA or any of its implementing regulations. As such, the plaintiffs' claims did not raise an issue of importance to the federal system as a whole and, under Gunn, the defendants did not meet the third element required for retaining the cases in federal court.

The defendants were also unable to prove the fourth Gunn element — that the Streed causes of action were capable of being resolved in federal court without disrupting the federal-state balance of powers approved by Congress. That is because Congress provided no federal private right of action for violation of the FDCA; therefore, it would flout congressional intent for the federal courts nevertheless to exercise federal-question jurisdiction and provide remedies to the Streed plaintiffs for violations of the FDCA.

With proof of all but one of the Gunn elements lacking, the court concluded it could not exercise federal-question jurisdiction, and so remanded Streed to state court.

Wyeth Case Goes Back to State Court

Because the drug-manufacturing defendants seeking federal retention of a case removed from state court were unable to prove the four elements of the U.S. Supreme Court's Gunn test for federal-question jurisdiction, the U.S. Disctrict Court for the Northern District of California remanded the case to state court. Streed v. Wyeth Pharmaceutical, Inc., 2017 U.S. Dist. LEXIS 135368 (N.D. Ca. 8/23/17).

A group of plaintiffs brought suit against several manufacturers and distributors of the drug amiodarone hydrochloride (both brand-name and generic versions), which is used to treat atrial fibrillation. All claimed they, or their loved ones, developed life-threatening and debilitating conditions, including pulmonary fibrosis, lung disease and vision loss, after taking the medication. Wyeth Pharmaceutical (Wyeth), one of the defendants, had been granted FDA approval to market the drug in 1985.

Plaintiffs contended that Wyeth and the other defendants unlawfully marketed the drug for off-label uses and actively hid from health care providers the dangers associated with it, through means such as failing to provide their health care providers with the required warning literature in the form of a “Medication Guide.” In total, the plaintiffs asserted eight state-law causes of action, including for strict liability-failure to warn, negligence-failure to warn, fraud and deceit, etc.

The defendants removed some of the causes of action from state to federal court. To keep these causes of action in federal court the defendants needed to show that they were either brought under federal law or that, although they were brought under state law, the claims necessarily raised “a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionally approved balance of federal and state judicial responsibilities.” See Gunn v. Minton , 568 U.S. 251 (2013).

The defendants first asserted the claims were inherently federal in nature, despite the fact that the plaintiffs had pleaded them as state law claims, because each relied on and expressly referenced the federal Food Drug and Cosmetic Act (FDCA) and its implementing regulations. Specifically, defendants pointed to plaintiffs' allegations that they: 1) violated the FDCA and its implementing regulations governing Medication Guides; and 2) violated the FDCA by promoting off-label uses of amiodarone hydrochloride. However, the court sided with the plaintiffs, noting that when a plaintiff seeks relief under state law, even repeated references to federal law will not render the cause of action one “arising under” federal law.

Moving on to the question of whether federal issues within the state law claims meant those claims were properly within the jurisdiction of the federal court, the court turned to the U.S. Supreme Court's Gunn decision for guidance. In Gunn, the Court said federal jurisdiction will lie where a state law claim raises a federal issue that is “(1) necessarily raised, (2) actually disputed, (3) substantial, and (4) capable of resolution in federal court without disrupting the federal-state balance approved by Congress.” See Gunn, 568 U.S. at 258.

The court then went through the four Gunn elements, beginning with whether federal issues were “necessarily raised” in the Streed plaintiffs' claims. For this, the question was whether federal law is a necessary element of the state law claim; in other words, if the state law claim can be supported by an alternative theory not dependent on the federal law, then the defendant cannot prove this first Gunn element. See Rains v. Criterion Sys., Inc. , 80 F.3d 339, 346 (9th Cir. 1996). Here, the court held the defendants failed to prove the element because “plaintiffs allege claims for strict products liability, negligence, fraud, and wrongful death, as well as claims under California's Unfair Competition Law (UCL) and Consumer Legal Remedies Act (CLRA), each of which can be supported by a theory independent of any violation of federal law or regulation.”

The defendants did meet their duty to show the “actually disputed” element because the parties disagreed as to the interpretation of the regulation governing distribution of Medication Guides ( 21 C.F.R. § 208.24).

For the third element — substantiality of the federal issue within the state law claim — the court quoted Gunn once more for its teaching that “it is not enough that [the issue] be significant to the particular parties in the immediate suit”; rather, the issue must be important “to the federal system as a whole.” See Gunn, 568 U.S. at 260. So, if the plaintiffs were challenging the federal statutes and rules in question in and of themselves, the third element might be met. However, the Streed court determined that the plaintiffs were challenging only the behavior of the defendants (failing to distribute the Medication Guides as required, promoting off-label uses of drugs) and not the validity of the FDA's actions, the FDCA or any of its implementing regulations. As such, the plaintiffs' claims did not raise an issue of importance to the federal system as a whole and, under Gunn, the defendants did not meet the third element required for retaining the cases in federal court.

The defendants were also unable to prove the fourth Gunn element — that the Streed causes of action were capable of being resolved in federal court without disrupting the federal-state balance of powers approved by Congress. That is because Congress provided no federal private right of action for violation of the FDCA; therefore, it would flout congressional intent for the federal courts nevertheless to exercise federal-question jurisdiction and provide remedies to the Streed plaintiffs for violations of the FDCA.

With proof of all but one of the Gunn elements lacking, the court concluded it could not exercise federal-question jurisdiction, and so remanded Streed to state court.