Medical Device Lawsuit Watch - June 2007

This summary of key lawsuits affecting medical devices is provided by the Health Care Law Group of Crowell & Moring LLP, in collaboration with the firm’s Torts, Antitrust and Intellectual Property Law Groups.

Cases in this issue:

• In re Guidant Corp. Implantable Defibrillators Products Liability Litigation
• Advanced Cardiovascular Systems, Inc. v. Medtronic Vascular, Inc.
• Brown v. DePuy Spine, Inc.
• Ethicon Endo-Surgery, Inc. v. Dianne Meyer
• ConMed Corporation v. Johnson & Johnson et al.
• Rattay v. Medtronic, Inc.
  

In re Guidant Corp. Implantable Defibrillators Products Liability Litigation D. Minn. No. 05-1708 4/17/07

The district court for the district of Minnesota has dismissed claims brought by a Medicare beneficiary under the Medicare Secondary Payer statute (“MSP Statute”), and claims brought by two third party employee welfare benefit funds (“EWBFs”), against Guidant in litigation involving the device-maker’s implantable cardioverter defibrillators (“ICDs”) and pacemakers.

Plaintiff Tamela Ivens argued that the MSP Statute, similar to the False Claims Act, partially assigns government claims to private plaintiffs, thus permitting private parties to bring suit on behalf of the government for economic wrongs done to the Medicare program. Guidant argued Plaintiff Ivens lacked standing to bring suit on behalf of other Medicare beneficiaries, and pointed out that she did not allege her own ICD malfunctioned or that she had suffered any financial loss. The court held that, unlike the False Claims Act, the MSP Statute does not unambiguously indicate that Congress intended to assign to private individuals the right to bring actions on behalf of the United States, and that Congress could not manufacture Article III standing merely by providing a private right of action in a statute.

The court similarly dismissed claims brought by two EWBFs for damages, breach of several Minnesota consumer protection laws, subrogation, unjust enrichment, and breach of warranty. The court found that, unlike third party payers in pharmaceutical lawsuits who forwent cheaper alternatives based upon representations made by pharmaceutical manufacturers, there was no direct relationship between the EWBFs and Guidant in this case. The EWBFs also failed to allege a causal connection between any injuries suffered by the EWBFs and Guidant’s alleged misconduct. On these bases, the court held the EWBFs lacked standing to bring their consumer protection claims. The court then held that the EWBFs subrogation and unjust enrichment claims must also be dismissed, because the EWBFs failed to identify any of their insureds who had alleged claims against or received money from Guidant.

Advanced Cardiovascular Systems, Inc. v. Medtronic Vascular, Inc. Civ. No. 98-80-SLR (D. Del. April 23, 2007)

On April 23, 2007, the District Court for the District of Delaware dismissed Medtronic Vascular Inc.’s (“Medtronic”) claims that Advanced Cardiovascular Systems, Inc. (“ACS”) had engaged in inequitable conduct in obtaining four U.S. Patents (collectively, the “Lau patents”). The Lau patents relate to endovascular support device (stents) that are used to treat cardiovascular disease.

This litigation was initiated on February 18, 1998 by Medtronic. Medtronic claimed that ACS and Guidant Sales Corporation (collectively, “ACS”) infringed its “Boneau patents.” ACS countersued Medtronic for alleged infringement of the Lau patents. ACS was later found not to infringe the Boneau patents.

In February 2005, a jury found that the Lau patents were not invalid and that they were infringed by Medtronic. The Delaware District Court held a bench trial on June 7 and 8, 2005 to decide Medtronic’s claims of alleged inequitable conduct. Medtronic argued that ACS intentionally withheld material information from the U.S. Patent and Trademark Office and that this information would have prevented the ACS patents from issuing. The material information asserted by Medtronic included Medtronic’s own Boneau patents and Dr. Boneau’s research activities with Dr. Stertzer, the first doctor to implant a stent in a human patient in the United States. The Delaware Court found that although some of the withheld information was material to the Lau patent applications, it was cumulative to other information submitted to the Patent Office.

Three of the Lau patents are currently being reexamined by the Patent Office.

Brown v. DePuy Spine, Inc. Mass. Super. Ct. No. BRCV2006-00208 4/9/07

The Superior Court of Massachusetts has held that the Medical Device Amendments to the Food, Drug, and Cosmetic Act (“MDA”) do not preempt state tort law claims where the claims were based on the manufacturer’s alleged departures from conditions of the device’s investigational device exemption and pre-market approval application.

Plaintiffs, who were all implanted with artificial intervertebral discs manufactured by DePuy Spine, Inc. (“DePuy”), sued DePuy on several products liability theories. Underlying Plaintiffs’ claims were allegations that the information DePuy gave to the FDA in the device approval process was inaccurate and incomplete and that DePuy failed to update clinical data, and thus the company had negligently failed to comply with its federal reporting and disclosure obligations. DePuy moved for summary judgment contending that plaintiffs’ claims were preempted by the MDA.

The Massachusetts Superior Court, agreeing with other courts that have addressed similar issues, and quoting federal case law, explained that “[i]t defies logic, and flies in the face of Congress’s decision to impose a regime strictly regulating medical device manufacturers, to think Congress intended . . . [that] once a medical device manufacturer obtains PMA approval, it would be insulated from liability even if it chose to conceal data from the FDA to maintain its PMA approval. Neither Lohr nor the FDA regulatory scheme can be stretched so far.” Accordingly, the court held that state law claims premised on a manufacturer’s negligent failure to comply with FDA reporting and disclosure obligations were not preempted and denied DePuy’s motion for summary judgment.

Ethicon Endo-Surgery, Inc. v. Dianne Meyer No. 2:05-071-CV Court of Appeals Second District of Texas April 6, 2007

In a split decision, a Texas state appeals court reversed the a trial court’s judgment holding Ethicon, the designer, manufacturer and marketer of a linear cutter, liable in a marketing-defect products liability case.

Meyer, a patient who had undergone surgery using Ethicon’s linear cutter, sued the surgeon, Dr. Mosier, for medical malpractice and Ethicon for products liability after she suffered a serious infection following a procedure involving the linear cutter. While Dr. Mosier settled with Meyer, the trial against Ethicon resulted in a jury finding that the linear cutter was defectively marketed. The trial court awarded Meyer $538, 281.73 in damages, fifty percent of which was apportioned to Ethicon. Ethicon appealed arguing the claim was barred by the statute of limitations and that Dr. Mosier’s testimony regarding his independent knowledge of the risks of using a linear cutter conclusively negated a producing cause with regard to the alleged marketing defect.

Relying on Dr. Mosier’s testimony, which made it clear that he had independent knowledge of the risk of staple-line leak, and Ethicon’s expert testimony that the possibility of a staple-line failure was common knowledge among general surgeons, the court held that the doctor’s independent knowledge of the risk conclusively negated causation. The court rejected Meyer’s argument that Dr. Mosier’s testimony was insufficiently specific to negate causation because he did not have independent knowledge of the exact risk that befell her. The court indicated that there was no evidence that the failure to warn of any exact or specific risk caused the injury.

ConMed Corporation v. Johnson & Johnson et al. No. 1:03-cv-08800-JES S.D.N.Y. April 6, 2007

On March 31, 2007, Johnson & Johnson, settled an antitrust suit filed by ConMed for $11 million.

In 2003, ConMed, a provider of surgical equipment, sued Johnson & Johnson and several of its subsidiaries in federal court claiming they violated federal and state antitrust laws by engaging in illegal and anticompetitive practices to market endoscopic surgical products which resulted in higher prices to consumers and the exclusion of competition. ConMed alleged that Johnson & Johnson’s anticompetitive practices included, among other conduct: (1) illegally using its monopoly as a maker of sutures to force hospitals wanting to buy its line of wound closing products to also buy a high percentage of their endoscopy product; (2) entering into exclusive contracts with hospitals requiring them to purchase endoscopy products solely from Johnson & Johnson; (3) threatening to impose financial penalties on hospitals if they purchased endoscopy products of competitors; and (4) providing hospitals with inaccurate and misleading information regarding their ability to deal with ConMed. ConMed argued that these sales tactics helped Johnson & Johnson gain 60 percent of the U.S. market for endoscopy products, despite its prices being above market.

In the lawsuit, ConMed sought an injunction restraining Johnson & Johnson from continuing its anticompetitive conduct as well as the maximum amount of damages allowed by law.

Rattay v. Medtronic, Inc. Case No.: 5:05-cv-00177 (N.D. West Virginia 4/3/01)

On April 3, the District Court for the Northern District of West Virginia held that claims of strict liability and failure-to-warn, arising out of the implantation of a Medtronic catheter were preempted by federal law. Medtronic’s catheter is a classified as a Class III device, which was approved under the Food and Drug Administration (“FDA”)’s pre-market approval (“PMA”) Process. Plaintiff received the catheter in 2002, and in 2003 doctors discovered that the catheter had broken off in Plaintiff’s third lumbar vertebra. Plaintiff filed a complaint seeking damages against Medtronic claiming strict liability, design, manufacturing and marketing negligence, failure to warn, and breach of express and implied warranty.

Medtronic moved for summary judgment, arguing that the majority of Plaintiff’s state law claims were preempted because the allegedly defective catheter was approved for sale and use in the U.S. through FDA’s rigorous PMA process. Finding that the Fourth Circuit had not yet addressed the preemptive implications of the FDA’s PMA process, the district court looked to Supreme Court and other federal court decisions for guidance. It ultimately chose to follow the majority of other federal circuits in holding that that the FDA’s approval of the PMA supplement for Medtronic’s catheter created device-specific federal requirements that preempt most state tort claims – including those for strict liability and negligence – that related to the safety and effectiveness of the device. In so doing, the court contrasted the device-specific requirements imposed under the PMA process with the more general requirements imposed under the 510(k) process.

At the same time, however, the court held that claims that the device violated FDA regulations relating to manufacture and marketing were not preempted. Moreover, Plaintiff’s breach of express warranty claim was not preempted because, according to the court, it was unclear whether Plaintiff claimed that he had relied upon statements that were necessary to comply with federal regulations.

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This material was prepared by Crowell & Moring LLP attorneys Chandra Westergaard Snyder, Jennifer Burdman, Jessica Hall, Lauren Kim and Heather Good. It is made available on the Crowell & Moring website for information purposes only, and should not be relied upon to resolve specific legal questions. If you have questions or want additional information, please call your regular Crowell & Moring contact or you may contact the editor of Medical Device Lawsuit Watch.