One to watch is E.I. du Pont de Nemours & Co. v. Travis Abbott et al., No. 23-13(U.S. cert. pending). And necessary disclosure your humble blogger co-authored an amicus brief on behalf of PLAC supporting the granting of the defendant’s petition for cert.

The case arises from the typically complex procedural history of an MDL involving multiple claims for alleged injuries arising from alleged water pollution. In short, the MDL court (affirmed by a split panel of the Sixth Circuit) decided to apply offensive preclusion from the results of three bellwether verdicts to bind the defendant throughout the remainder of the entire MDL.

The MDL court had assured the parties that the results of bellwether trials would not be applied to future trials. As is often the case, the cases tried were admittedly known not to be representative of the bulk of the MDL inventory, given the selection process employed. The early trials, like others in most MDLs, were meant to test legal strategies and possibly inform a global settlement. The decision also conflicts with mass tort decisions of other circuits; plaintiffs could not cite a single case where nonmutual offensive collateral estoppel has ever before been permitted in these circumstances. Clearly, applying preclusion to an entire MDL based on a handful of expressly nonbinding bellwethers is fundamentally unfair.

Moreover, if a defendant wins one or more bellwether trials, nothing happens to the rest of the plaintiffs– they still can try or settle their cases as they which. But, according to the Sixth Circuit, it is fair if defendants lose one or a few bellwethers and the game is virtually over.

The decision fundamentally ignores the reality of MDLs- which represent a majority of the cases pending in the federal courts. Approximately 406,000 cases are pending in 179 MDLs. See United States Judicial Panel on Multidistrict Litigation, Pending MDLs by Actions Pending. It ignores plaintiffs’ counsel’s ability to drop or settle risky (for plaintiffs) bellwethers. That gamesmanship is common. It ignores the reality that failing to win a single bellwether out of the first handful of cases does not mean that defendants have a weak overall case and deserve to lose thousands of other cases; history shows that in multiple MDLs plaintiffs’ early success was followed by long defense jury verdict winning streaks. (e.g. Roundup, Vioxx). The risk of unfair preclusion will create incentives for parties to detour from proven approaches that have fostered efficiency, effectiveness, and even a degree of cooperation across multiple MDLs. The panel’s decision is thus a precedent-setting error of exceptional public importance.

The debates about the MDL venue (in cases the JPML finds appropriate for coordination) will, in turn, no longer focus on efficiency-related factors such as location of witnesses and evidence. See David F. Herr, Multidistrict Litigation Manual § 6:5 (2021) (“The Panel has frequently considered the location of documents and witnesses in selecting a transferee district.”). Instead, the Panel will have to wrestle with the possible placement of the cases within a circuit that permits the novel, reverse-course, application of collateral estoppel to bellwether case outcomes, as opposed to the majority of candidate courts that recognize the fairness, notice, due process and practical concerns that should prevent its use. E.g., In re Chevron U.S.A., Inc., 109 F.3d 1016, 1020 (5th Cir. 1997).

Like a solar eclipse the shadow of this unfair possibility will affect MDL discovery (need more), jury verdict forms in bellwethers (must be more specific), and the availability of cases for trial in light of Lexecon (why would a defendant ever consent/waive now?). Most importantly, as Judge Batchelder recognized, dissenting in relevant part, the panel’s decision “essentially guts the utility of informational bellwether trials.” In re E. I. du Pont de Nemours & Co. C-8 Pers. Injury Litig., 54 F.4th 912, 944 (6th Cir. 2022) (Batchelder, J., concurring part and dissenting in part). The bellwether process has become one of the most widely used and effective tools at an MDL court’s disposal.

Let’s hope the cert petition finds receptive ears.

Plaintiff. a neighbor of a chemical plant in Delaware, sued the plant alleging that it had released carcinogenic ethylene oxide gas into the air; plaintiff proposed a class action, asserting claims for strict liability, negligence, and private and public nuisance. The United States District Court for the District of Delaware granted plant’s motion to dismiss, 2021 WL 7209363, and plaintiff appealed. The Third Circuit, 2022 WL 19010312, certified a question to the Delaware Supreme Court: under Delaware law, is an increased risk of illness without physical harm a cognizable “injury” actionable in tort?

The court in Baker v. Croda Inc., No. 393, 2022, 2023 WL 5517797 (Del. Aug. 24, 2023), answered with a clear “NO.” An increased risk of illness without physical harm is not a cognizable injury under Delaware law. Stated differently, an increased risk of harm only constitutes a cognizable injury once it manifests in a physical disease. It is axiomatic that all tort claims require an injury. Under Delaware law, an “injury in fact” is defined as an invasion of a legally protected interest which is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical. An increased risk of illness, without more, is not “actual or imminent,” and thus does not constitute an injury.

The court offered both established precedent and public policy concerns underpinning this answer. In Metro-North Commuter Railroad Company v. Buckley, a case involving a railroad worker who was exposed to asbestos but had not been afflicted by disease, the United States Supreme Court rejected a claim for medical monitoring under a federal statute. It also highlighted the serious public policy concerns that could follow if it adopted “a traditional, full-blown ordinary tort liability rule,” observing that “tens of millions of individuals may have suffered exposure to substances that might justify some form of substance-exposure-related medical monitoring.” This fact, “along with uncertainty as to the amount of liability, could threaten both a flood of less important cases … and the systemic harms that can accompany unlimited and unpredictable liability.”

Similarly, in Mergenthaler v. Asbestos Corporation of America, 480 A.2d 647 (Del. 1984), a case involving claims by present or former asbestos workers and their spouses, the court addressed “[w]hether a claim for the expenses of medically required surveillance and related mental anguish of the plaintiffs’ wives fails to state a claim upon which relief can be granted where there is no present physical injury.” The court held that present physical disease was required to state a claim under Delaware law. Plaintiff tried to read this and similar cases as adopting an “actual exposure” test permitting plaintiffs to recover for claims based on fear of disease when accompanied by “actual exposure” to a disease-causing agent. But as to a negligence action the precedent concurred with the finding that the plaintiffs could not recover in the absence of a physical injury.

The holding that an increased risk of illness, without more, cannot be a cognizable injury under Delaware law comports with the established principle that claims in tort require an actual or imminent injury. To hold otherwise would constitute a significant shift in state tort jurisprudence. Further, the District Court’s observation that “Delaware tort law presupposes that plaintiffs will bring suits after they suffer physical symptoms, not before” is apt. As it stands, the statute of limitations for toxic tort claims starts to run when a plaintiff begins to experience physical effects. In addition, toxic tort plaintiffs are permitted to bring separate claims for separate diseases caused by one exposure.

As the Third Circuit noted, “the decision to recognize an increased risk of disease as a cognizable injury is significant, and its implications are far reaching.” Contacts, even extensive contacts, with serious carcinogens are common. Indeed, millions of individuals have suffered exposure to substances that will never result in any harm. Recognizing an increased risk of illness, without more, as a cognizable injury could open the floodgates to “endless and limitless” litigation. Dispensing with the physical injury requirement could also diminish resources that are presently used for those who have suffered physical injury.

As is often noted, this policy issue belongs in the legislature; if Delaware’s General Assembly ever decides to recognize medical monitoring as a separate cause of action, it is much better suited to address the complicated issues that would arise such as when the limitations period would begin to run, whether a higher pleading standard might be required, what type of test should be utilized to determine whether someone qualifies for medical monitoring, or whether medical monitoring costs would be provided by a court-supervised fund, among others. Baker v. Croda Inc., No. 393, 2022, 2023 WL 5517797, at *2–4 (Del. Aug. 24, 2023).

The Supreme Court decided the closely watched jurisdictional case, Mallory v. Norfolk S. Ry. Co., 600 U.S. 122, 143 S. Ct. 2028, 216 L. Ed. 2d 815 (2023). In a series of decisions, the Court has sought to clarify the issues of personal jurisdiction (where a defendant can be sued), and the concepts of both general and specific jurisdiction. In Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (2011), the Supreme Court explained that a court may only assert general jurisdiction over foreign corporations where “their affiliations with the [forum] State are so ‘continuous and systematic’ as to render them essentially at home” there. Id. at 919. In Daimler AG v. Bauman, 571 U.S. 117, 139 (2014), the Court later clarified that the general jurisdiction inquiry concerns whether that corporation’s “affiliations with the State are so ‘continuous and systematic’ as to render [it] essentially at home
in the forum State.” After Goodyear and Daimler, it was recognized that general jurisdiction will usually not obtain in a “forum other than the place of incorporation or principal place of business.” E.g., Monkton Insurance Services., Ltd. v. Ritter, 768 F.3d 429, 432 (5th Cir. 2014).

Mallory appears to throw a monkey wrench into these notions, and seems like a step backwards on the Court’s effort to curtail blatant forum shopping. But the decision does not reverse the recent case law, and rather makes an end-around. Consenting to jurisdiction – voluntarily waiving one’s due process rights – is an independent basis for jurisdiction. See Brady v. United States, 397 U.S. 742, 748
(1970) (observing that waivers of constitutional rights must be voluntary, knowing, and intelligent). After the roadblocks of Daimler, plaintiffs increasingly argued that corporate defendants had consented to general jurisdiction based on their compliance with a state’s mandatory business registration statute. Virtually every state has some form of business registration law, often covering such things as fictitious names, service of process, and, often, consent to jurisdiction in the state’s courts. Generally, the argument goes, by registering or qualifying to do business in a state or appointing an agent for service of process, a company has expressly or impliedly consented to general jurisdiction. The contrary view is that it would violate the Due Process Clause to construe a foreign corporation’s compliance with a state’s mandatory registration statute as voluntary consent. In light of the Supreme Court’s repeated admonishment that due process prohibits a state from claiming general jurisdiction over every corporation doing business within its borders, it logically follows that the Due Process Clause also
prohibits a state from forcing every corporation doing business within its borders to consent to general jurisdiction. Only voluntary consent or affiliations within the state that are so continuous and systematic as to render the foreign corporation essentially at home in the state will suffice.

Four Justices agreed that this statute “clearly, palpably, and plainly violates the Constitution.” And they rejected the attempt to make the jurisdictional issue solely about consent rather than contacts, because a company could theoretically be forced to “consent” and still not have minimal contacts, a principal place of business, or be the place of incorporation in the state. In this way, said the dissent, Mallory’s theory would gut Daimler. And it made no sense to suggest the Court already decided this question in a pre-International Shoe precedent: Pennsylvania Fire Ins. Co. of Philadelphia v. Gold Issue Mining & Milling Co., 243 U.S. 93, 37 S.Ct. 344, 61 L.Ed. 610 (1917).

An unlikely majority of Justices Gorsuch, Thomas, Alito, Sotomayor and Jackson (on parts of the opinion), found the issue controlled by Pennsylvania Fire Ins. Co. of Philadelphia v. Gold Issue Mining & Milling Co., 243 U.S. 93, 37 S.Ct. 344, 61 L.Ed. 610. The Pennsylvania law at issue here provided that an out-of-state corporation “may not do business in this Commonwealth until it registers with” the Department of State. 15 Pa. Cons. Stat. § 411(a). Among other things, Pennsylvania law is explicit that “qualification as a foreign corporation” shall permit state courts to “exercise general personal jurisdiction” over a registered foreign corporation, just as they can over domestic corporations. 42 Pa. Cons. Stat. § 5301(a)(2). And, importantly, this did not violate due process.

Importantly, Justice Alito went on to observe that a state’s assertion of jurisdiction over lawsuits with no real connection to the state may violate fundamental principles that are protected by one or more constitutional provisions or by the very structure of the federal system that the Constitution created. At this point in the development of our constitutional case law, the most appropriate home for these principles is the so-called dormant Commerce Clause. Id. at 150.

While the notion that the Commerce Clause restrains States has been the subject of “thoughtful critiques,” the concept is “deeply rooted in our case law,” Tennessee Wine, 588 U. S., at ––––, 139 S.Ct., at 2460, and vindicates a fundamental aim of the Constitution: fostering the creation of a national economy and avoiding the every-State-for-itself practices that had weakened the country under the Articles of Confederation. See Hughes v. Oklahoma, 441 U.S. 322, 325–326, 99 S.Ct. 1727, 60 L.Ed.2d 250 (1979); Healy v. Beer Institute, 491 U.S. 324, 335–336, 109 S.Ct. 2491, 105 L.Ed.2d 275 (1989). The Framers “might have thought [that other provisions] would fill that role,” but “at this point in the Court’s history, no *158 provision other than the Commerce Clause could easily do the job.” Tennessee Wine, 588 U. S., at ––––, 139 S.Ct., at 2460. Justice Alito went on to say, in its negative aspects, the Commerce Clause serves to “mediate [the States’] **2052 competing claims of sovereign authority” to enact regulations that affect commerce among the States. National Pork Producers Councilv.Ross, 598 U. S. ––––, ––––, 143 S.Ct. 1142, 1156–1157, ––– L.Ed.2d –––– (2023). The doctrine recognizes that “one State’s power to impose burdens on … interstate market[s] … is not only subordinate to the federal power over interstate commerce, but is also constrained by the need to respect the interests of other States.” BMW of North America, Inc. v. Gore, 517 U.S. 559, 571, 116 S.Ct. 1589, 134 L.Ed.2d 809 (1996) (citing Gibbons v. Ogden, 9 Wheat. 1, 194–196, 6 L.Ed. 23 (1824)). It is especially appropriate to look to the dormant Commerce Clause in considering the constitutionality of the authority asserted by Pennsylvania’s registration scheme. Because the right of an out-of-state corporation to do business in another State is based on the dormant Commerce Clause, it stands to reason that this doctrine may also limit a State’s authority to condition that right. See Granholm v. Heald, 544 U.S. 460, 472, 125 S.Ct. 1885, 161 L.Ed.2d 796 (2005); H. P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 539, 69 S.Ct. 657, 93 L.Ed. 865 (1949).

Look for this issue to be the next hot battleground in the personal jurisdiction fight as plaintiffs try to forum shop.

Readers know of our interest in medical monitoring, an interest which dates back to trying a medical monitoring class action to a defense jury verdict decades ago. Your humble blogger co-authored the Medical Monitoring chapter in American Bar Association’s A Practitioner’s Guide to Class Actions, Third Edition.

Our friends at the highly regarded Drug and Device Law blog have written two important posts on the subject in the past few weeks.

The first describes the ridiculous (my term) effort of certain elements in the ALI to bless no injury medical monitoring claims, despite the absence of any consensus case law in favor of this radical position. In “Always Liability Increases (ALI)?  Not Yet with Medical Monitoring.” The D&DL folks offer their take on a fundamental problem with the ALI’s current approach to medical monitoring: from the moment this project (first called “Concluding Provisions” and now renamed as “Miscellaneous Provisions” to the Restatement Third of Torts) began in early 2019, the reporters have seemed dead set that the ALI will recognize no-injury medical monitoring – no matter what the law actually is – because they believe that giving money to currently uninjured people, who may never get sick, based on bare “increased risk,” is the “better” rule of law.

Putting their money where their mouth is, the D&DL folks follow up with a Medical Monitoring – 50-State Survey a detailed 50-state analysis of no-injury medical monitoring, which shows that the ALI reporter’s material was, at best, incomplete.  

Both are required reading for anyone interested in this doctrine.

Better late than never. We missed last month the decision in Costa v. Johnson & Johnson, No. CV 17-452 WES, 2023 WL 2662903, at *3 (D.R.I. Mar. 28, 2023), a product liability asserting a pelvic mesh medical device was defective. Plaintiff alleged, inter alia. a failure to warn claim under Rhode Island law.

Under that state’s failure-to-warn theory of strict product liability, a plaintiff must prove that the failure to warn of the product’s dangers “that are reasonably foreseeable and knowable at the time of marketing” “render[ed] the product unreasonably dangerous in spite of all reasonable care exercised by the manufacturer.” Castrignano, 546 A.2d at 779, 782. “The plaintiff has the burden of proving a defect in the product and that his or her injury was proximately caused by this defect.” Austin v. Lincoln Equip. Assocs., Inc., 888 F.2d 934, 936 (1st Cir. 1989). The Rhode Island Supreme Court has described the standard as “equivalent to the standard for negligence.” Castrignano, 546 A.2d at 782; accord DiPalma v. Westinghouse Elec. Corp., 938 F.2d 1463, 1466 (1st Cir. 1991) (“It is clear under Rhode Island law that the duty to warn … is measured, in all respects material to this case, by the same standard as the duty to warn that is enforceable in a negligence cause of action.”). Plaintiffs must establish the standard of care with expert testimony. See Mills v. State Sales, Inc., 824 A.2d 461, 468 (R.I. 2003); Raimbeault v. Takeuchi Mfg. (U.S.), Ltd., 772 A.2d 1056, 1063 (R.I. 2001).

Defendants argued that the learned intermediary doctrine applied here. Under the doctrine, a manufacturer of a prescription medical device can discharge its liability by providing an adequate warning of the risks of the device to “prescribing and other health-care providers who are in a position to reduce the risks of harm in accordance with the instructions or warnings,” even if the manufacturer did not provide any warning to the patient directly. The rationale supporting this learned intermediary rule is that health-care professionals are in a position to understand the significance of the risks involved and to assess the relative advantages and disadvantages for the patient. The duty then devolves on the health-care provider to supply to the patient such information as is deemed appropriate under the circumstances so that the patient can make an informed choice. Accordingly, if the specific risk was known to the physician, a manufacturer’s alleged failure to warn of that risk cannot be considered a defect. See In re Zyprexa Products Liab. Litig., 277 F.R.D. 243, 250 (E.D.N.Y. 2011) aff’d sub nom Greaves v. Eli Lilly & Co., 503 F. App’x 70, 71 (2d Cir. 2012).

The Rhode Island Supreme Court has not expressly adopted the learned intermediary doctrine, and Plaintiffs here urged the court to certify the question to the Rhode Island Supreme Court. The federal court declined this invitation. “Even in the absence of controlling precedent, certification would be inappropriate where state law is sufficiently clear to allow us to predict its course.” In re Engage, Inc., 544 F.3d 50, 53 (1st Cir. 2008); see Hugel v. Milberg, Weiss, Bershad, Hynes & Lerach, LLP, 175 F.3d 14, 18 (1st Cir. 1999) (“[W]hen state law is sufficiently clear to allow [a federal court] to predict its course, certification is both inappropriate and an unwarranted burden on the state court.”).

Here, a number of factors counseled in favor of predicting that the Rhode Island Supreme Court would adopt the learned intermediary doctrine. First, the Rhode Island Supreme Court has implicitly referenced the doctrine when describing the proximate cause element of a failure to warn claim. See Hodges v. Brannon, 707 A.2d 1225, 1227-28 (R.I. 1998). In addition, the Rhode Island Supreme Court frequently relies on the Second and Third Restatements of Torts as a basis for the state’s product liability law. Specifically, the learned intermediary doctrine is defined in § 388 of the Second Restatement, which the Rhode Island Supreme Court has cited with approval in other contexts. See Maggi v. De Fusco, 267 A.2d 424, 427 (R.I. 1970) (citing § 388(b)). The doctrine is also defined in § 6 of the Third Restatement of Torts: Products Liability, other provisions of which the Rhode Island Supreme Court has cited with approval. See, e.g., Calise v. Hidden Valley Condo Ass’n, 773 A.2d 834, 846 n.13 (R.I. 2001) (citing Restatement (Third) Torts). Thus, the Rhode Island Supreme Court’s treatment of the Second and Third Restatements left the federal court with “no reason to expect Rhode Island, if it were to adopt the learned intermediary doctrine, to offer an unusual interpretation of it, thereby rejecting the current edition of the Restatement.” Hogan v. Novartis Pharms. Corp., No. 06 Civ. 0260(BMC)(RER), 2011 WL 1533467, at *10 (E.D.N.Y. Apr. 24, 2011).

The Class Action Fairness Act (CAFA) extends federal diversity jurisdiction to certain “mass actions” involving “100 or more persons.” 28 U.S.C. § 1332(d)(11)(B)(i). One might think that since CAFA was passed in 2005, the notion of mass action would have been fully analyzed. The Supreme Court has long construed jurisdictional statutes like CAFA to establish “simple” bright-line rules. Hertz Corp. v. Friend, 559 U.S. 77, 94–95, 130 S.Ct. 1181, 175 L.Ed.2d 1029 (2010); see Sisson v. Ruby, 497 U.S. 358, 375, 110 S.Ct. 2892, 111 L.Ed.2d 292 (1990) (Scalia, J., concurring in judgment) (eschewing “the sort of vague boundary that is to be avoided in the area of subject-matter jurisdiction wherever possible”). Yet plaintiffs continue to bring mass actions in state courts. At issue in Adams v. 3M Co., 65 F.4th 802 (6th Cir. 2023) was whether two state-court complaints, each joining more than 100 plaintiffs, qualified as CAFA mass actions. Plaintiffs were miners who alleged they wore defendant’s respirators to protect their lungs from coal dust, but nevertheless developed pneumoconiosis, a disease caused by inhaled dust particles.

One complaint named more than 400 co-plaintiffs, demanded “judgment” against all defendants “jointly, severally, and/or individually,” and sought “a trial by jury on all issues so triable.” The second complaint named more than 300 co-plaintiffs and mirrored the first. Defendant removed the cases to federal court on CAFA, federal question, and diversity grounds. The district court, surprisingly, remanded them to state court. 3M sought leave to appeal, as under § 1453(c)(1), “a court of appeals may accept an appeal from an order of a district court granting or denying a motion to remand a class action.” For purposes of the section, “a mass action shall be deemed to be a class action.” 28 U.S.C. § 1332(d)(11)(A).

There was no dispute that lawsuits qualify as “civil action[s]” and seek “monetary relief.” That left one question: Had plaintiffs proposed to try claims of 100 or more persons … jointly on the ground that the claims “involve common questions of law or fact”? The 6th Circuit observed that the miners’ complaints did just that. Start with the first phrase. A litigant proposes to try claims “jointly” if he offers to try them through a common judicial process. Claims presented in a single complaint proceed through a common trial process absent an order to the contrary. When plaintiffs each filed complaints with more than 100 co-plaintiffs, they offered to try their co-plaintiffs’ claims jointly. See In re Abbott Lab’ys, Inc., 698 F.3d 568, 572 (7th Cir. 2012) (“[O]ne complaint implicitly proposes one trial ….”).

Turn to the second phrase. A litigant proposes a joint trial “on the ground[s] … [of] common questions of law or fact” when he offers, as a basis or reason for joint proceedings, the contention that the claims involve common questions. By filing a complaint predicated on a “common” “question of law or fact,” plaintiffs thus offered the presence of common questions as a “ground” for pursuing a joint trial, 28 U.S.C. § 1332(d)(11)(B)(i).

CAFA targets putative class actions and lawsuits that resemble them—“mass actions” in short. Mississippi ex rel. Hood v. AU Optronics Corp., 571 U.S. 161, 173–74, 134 S.Ct. 736, 187 L.Ed.2d 654 (2014). Lawsuits like the miners’ complaints fit the bill, said the court. They assert parallel claims on behalf of more than 100 plaintiffs, all proceeding on the theory that the claims are similar enough to merit adjudication in tandem. Every circuit to consider the question agrees. “Where a single complaint joins more than 100 separate claims involving common questions of law and fact, there is a presumption that those plaintiffs have implicitly proposed a joint trial.” Ramirez v. Vintage Pharms., LLC, 852 F.3d 324, 329 (3d Cir. 2017); see Lester v. Exxon Mobil Corp., 879 F.3d 582, 585–89 (5th Cir. 2018); Abbott Lab’ys, 698 F.3d at 572; Atwell v. Bos. Sci. Corp., 740 F.3d 1160, 1163–66 (8th Cir. 2013); Visendi v. Bank of Am., N.A., 733 F.3d 863, 869 (9th Cir. 2013); Scimone v. Carnival Corp., 720 F.3d 876, 881–82 (11th Cir. 2013); cf. Parson v. Johnson & Johnson, 749 F.3d 879, 888 & n.4 (10th Cir. 2014) (suggesting the same); accord 2 William B. Rubenstein, Newberg & Rubenstein on Class Actions § 6:25 (6th ed. 2022).

The miners respond that, under Kentucky or federal law, their cases may not ultimately involve common questions of law or fact. Still, an ultimately unwarranted proposal remains a proposal. See Visendi, 733 F.3d at 867–71. Nor did it matter that a joint trial may never result, perhaps even on a defendant’s motion to bifurcate or sever. Here, each filed a complaint joining more than 100 co-plaintiffs and seeking “a” jury trial. See Ramirez, 852 F.3d at 327 (requiring an “explicit and unambiguous disclaimer” of a joint trial).

In the alternative, plaintiffs asked the court to affirm the remand order under CAFA’s “local controversy” exception. See 28 U.S.C. § 1332(d)(4). But for the exception to apply, the miners needed to show that a Kentucky defendant’s conduct “forms a significant basis for the[ir] claims.” Mason v. Lockwood, Andrews & Newnam, P.C., 842 F.3d 383, 388, 395–97 (6th Cir. 2016). Here, the “core” of the miners’ complaints alleged that out-of-state defendants designed, manufactured, and sold defective respirators, and plaintiffs offered no reason for thinking that the defendant local merchants’ liability was anything but derivative of the manufacturer’s alleged liability. Remand reversed.

Movie buffs may recite multiple comedic movies including a “no MSG” line in the script, but because of consumer preferences many food manufacturers do prominently label their products as “No MSG” or “No Added MSG.” Plaintiff in Henry v. Nissin Foods (U.S.A.) Co. Inc., No. 22CV363NGGRER, 2023 WL 2562214, at *1 (E.D.N.Y. Mar. 17, 2023), brought various claims against Defendant Nissin Foods over such a use of the phase “No Added MSG” in relation to certain products that it manufactures and sells. She sought relief on behalf of herself and a proposed class of similarly situated purchasers of Defendant’s products, asserting claims for (i) violation of various state consumer protection statutes; (ii) deceptive business practices under N.Y. G.B.L. § 349; (iii) deceptive advertising under N.Y. G.B.L. § 350; (iv) breach of express warranty; and (v) breach of the Magnuson-Moss Warranty Act. Defendant moved to dismiss Plaintiff’s Complaint in its entirety for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). The Court dismissed the complaint using an oft overlooked common sense point worth a note here.

The parties primarily disputed whether a reasonable consumer would be misled by the “No Added MSG” label and the Products’ packaging. According to Defendant, no reasonable consumer would be confused by the packaging] because: 1) no MSG is actually added to the Products, 2) the Products contain a Disclaimer right next to the phase No Added MSG, which informs consumers that the Products do in fact contain naturally occurring glutamates. Plaintiff countered that a reasonable consumer would understand the “No Added MSG” label to mean that Defendant does not even add free glutamates to the Products.

Whether or not a reasonable consumer would be misled by the allegedly deceptive packaging is a question of law that can be decided by a court at motion to dismiss. It is not a question of fact. Mere allegations in a complaint that a statement would mislead a reasonable consumer do not satisfy a plaintiff’s burden at the pleading stage. See, e.g., Wynn v. Topco Asscs., LLC, No. 19-CV-11104 (RA), 2021 WL 168541, at *3 (S.D.N.Y. Jan. 19, 2021). Courts in the 2d Circuit have regularly dismissed GBL claims when warranted considering the alleged facts. See, e.g., Warren v. Whole Foods Mkt. Grp., Inc., 574 F. Supp. 3d 102, 117 (E.D.N.Y. 2021); Boswell v. Bimbo Bakeries USA, Inc., 570 F. Supp. 3d 89, 96 (S.D.N.Y. 2021); Davis v. Hain Celestial Grp., Inc., 297 F. Supp. 3d 327, 337 (E.D.N.Y. 2018); Engram v. GSK Consumer Healthcare Holdings (US) Inc., No. 19-CV-2886 (EK) (PK), 2021 WL 4502439, at *1 (E.D.N.Y. Sept. 30, 2021).

Materially misleading representations are those likely to mislead a reasonable consumer acting reasonably under the circumstances. This inquiry is objective. Cohen v. JPMorgan Chase & Co., 498 F.3d 111, 126 (2d Cir. 2007). Courts view each allegedly misleading statement in light of its context on the product label or advertisement as a whole. The entire mosaic is viewed rather than each tile separately. Belfiore v. Proctor & Gamble Co., 311 F.R.D. 29, 53 (E.D.N.Y. 2015).

Here Plaintiff’s argument on the allegedly misleading nature of the “No Added MSG” label rests in large part on FDA guidance and statements. Plaintiff acknowledged that FDA guidance on terminology has been disregarded in certain cases but argued that this has only occurred where the regulations at issue are “hyper-technical.” But this distinction has not been recognized in caselaw. See, e.g., Warren, 574 F. Supp. 3d at 113-14 (finding FDA regulations to be inapplicable to the reasonable consumer analysis under N.Y. G.B.L. §§ 349 and 350); Garadi v. Mars Wrigley Confectionery US, LLC, No. 19-CV-3209 (RJD) (ST), 2021 WL 2843137, at *3 (declining to consider FDA regulations in the context of evaluating claims under N.Y. G.B.L. §§ 349 and 350). It is also unclear which FDA regulations are so “hyper-technical” as to be unrelated to the views of reasonable consumers, and which are not. In the court’s view here, such a determination would be difficult to ascertain. Many FDA regulations involve some degree of technical expertise.

Moreover, the notion of “misleading” under the Federal Food, Drug, and Cosmetic Act is not the same as “materially misleading” under state consumer protection statutes, such as N.Y. G.B.L. §§ 349 and 350. Under the FDCA, “in determining whether the labeling or advertising is misleading there shall be taken into account … not only representations made or suggested by statement, word, design, device, or any combination thereof, but also the extent to which the labeling or advertising fails to reveal facts material in the light of such representations or material with respect to consequences which may result from the use of the article.” 21 U.S.C. § 321(n); see also 21 U.S.C. § 343(a). But the New York Court of Appeals has prescribed a much different meaning for the term “materially misleading”—that which is likely to mislead a reasonable consumer acting reasonably under the circumstances. Orlander, 802 F.3d at 300. The term “reasonable consumer” appears nowhere in the FDCA’s definition of “misleading.” Other courts in the 2d Circuit have reached the same conclusion. See Warren, 574 F. Supp. 3d at 113 (“The FDA and New York law apply different standards.”); Steele v. Wegmans Food Mkts., Inc., 472 F. Supp. 3d 47, 49 (S.D.N.Y. 2020) (“[T]he extensive discussion and argument in the motion papers with respect to particular federal standards for ice cream flavor descriptions is without consequence.”); Daniel v. Mondelēz Int’l, Inc., 287 F. Supp. 3d 177, 190 (E.D.N.Y. 2018); see also Bush v. Mondelēz Int’l, Inc., No. 16-CV-02460 (RS), 2016 WL 7324990, at *3 (N.D. Cal. Dec. 16, 2016).

So out went the reliance on the FDA’s statements on the term “No Additional MSG” in determining whether Plaintiff has pleaded sufficient facts as to the reasonable consumer inquiry. Even if on its face the no added language could be misleading in terms of whether it meant during the production process or after the production process, the court looked to the disclaimer next to the “No Added MSG” label to determine if it corrects the alleged misconception created by the label. ““[I]n determining whether a reasonable consumer would have been misled by a particular advertisement, “Context is crucial … under certain circumstances, the presence of a disclaimer or similar clarifying language may defeat a claim of deception.” Fink, 714 F.3d at 742; see also Nelson v. MillerCoors, LLC, 246 F. Supp. 3d 666, 674-75 (E.D.N.Y. 2017). Here, the Products’ packaging included the disclaimer: “contains small amounts of naturally occurring glutamates.” It was on the front of the packaging right next to the “No Added MSG” label. It is in the same white, capitalized lettering as the labels at issue, although in smaller font. The disclaimer was also linked to the “No Added MSG” label by an asterisk. This asterisk puts consumers on notice that the packaging contains related additional information. A reasonable consumer would not miss it. Concluding otherwise would “attribute[ ] to consumers a level of stupidity that the Court cannot countenance.” See Kommar v. Bayer Consumer Health, 252 F. Supp. 3d 304, 312 (S.D.N.Y. 2017).
Plaintiff’s proffered interpretation of the label—no free glutamates whatsoever—directly conflicts with the disclaimer, which states that natural glutamates are in fact present.

As is often the case, Plaintiff twisted herself in circles to try to escape the motion. She contended that the disclaimer does not cure the misconception left by the label for consumers who seek to avoid MSG because they are unaware that the term “free glutamate” means the same thing. Yet the Complaint specifically alleged that “to consumers, MSG means free glutamate” and that “the only reason a consumer might want to avoid consuming foods that contain MSG is if they want to avoid consuming free glutamates.” Of course, any consumer who is unaware that MSG and free glutamates refer to the same thing, as alleged, could not be misled in the first place.

Therefore, the court found that the disclaimer clarified any alleged incorrect impression created by the “No Added MSG” label and that a reasonable consumer would not be misled to believe that the Products do not contain free glutamates. They would reach this conclusion without being forced to consult the ingredient panel on the Products’ packaging. Complaint dismissed with prejudice.

We cannot offer any additional commentary because the Firm was part of the team representing defendant, but we wanted to commend to our readers the recent decision, In re Zofran (Ondansetron) Prod. Liab. Litig., 57 F.4th 327 (1st Cir. 2023). The case arises in the MDL related to the FDA-approved drug Zofran, and plaintiffs’ allegations that use during pregnancy caused birth defects. After years of litigation, the United States District Court for the District of Massachusetts, F. Dennis Saylor IV, Chief Judge, 541 F.Supp.3d 164, entered summary judgment for the former manufacturer on the basis of the doctrine of preemption. Defendant argued that the FDA had been fully informed of the alleged risks of the drug, and by, inter alia, approving an updated label for the current manufacture — not containing the additional warnings plaintiffs had demanded — the agency had clearly found the prior label adequate in this regard.

The First Circuit affirmed, noting that certain Japanese animal studies of the anti-emetic drug did not reveal any risks of teratogenicity, i.e., a drug’s ability to cause defects in a developing fetus, that prior studies shared with the FDA did not already discuss, and thus these animal studies did not constitute “newly acquired information” that would have required the drug’s manufacturer to make use of the Changes Being Effected (CBE) procedure to amend the label unilaterally. Indeed, the investigators in those studies concluded that the observed anomalies in the animal subjects were not dose-related and there was no evidence of teratogenicity.

The appeals court also concluded that even if the manufacturer could have invoked the CBE procedure to change the label to state that animal studies showed some evidence of teratogenicity, the FDA would have rejected such a change, because when approving an updated label for the later owner of the drug, the FDA approved a statement that the data revealed no significant effects of the drug on maternal animals or the development of offspring.

Worth a look as part of the new post-Albrecht landscape.

Worth our note is a recent preemption decision in  In re Fosamax (Alendronate Sodium) Products Liability Litigation, 2022 WL 855853 (D.N.J. March 23, 2022).  The case is noteworthy because it contains a cogent and well-reasoned exploration of many of the issues flowing from the Supreme Court’s decision in Merck Sharp & Dohme Corp. v. Albrecht, 139 S. Ct. 1668 (U.S. 2019).  Albrecht, of course, clarified some of the language in Wyeth v. Levine, 555 U.S. 555 (2009), particularly with regard to the need in a warnings context that there should be clear evidence that the FDA would have rejected the plaintiff’s proposed alternative label.

Since Wyeth, plaintiffs facing preemption motions have advanced a litany of arguments trying to turn the clear evidence language into an insurmountable hurdle, no matter the procedural posture, and no matter how clear the record before the agency.  When all else failed, plaintiffs argued that there were “fact issues” that had to go to a jury.  Albrecht ended that one, noting preemption is a legal issue for the court, even as to subsidiary fact questions.  Fosamax addresses many of the other typical arguments, including reconfirming the only commonsense reading of Wyeth, that the manufacturer does not have to actually request that the agency adopt plaintiffs’ label, but that preemption may be established by reference to what the FDA would have done if faced with a label change.  Of course, out of  the many decisions since Albrecht, none appears to have agreed with plaintiffs on this point.  The court also confirmed that enough is enough: that is, while plaintiffs argued that the defendant could have, perhaps, theoretically, changed the FDA’s decision had defendant somehow not taken “no” for an answer but went on engaging with the Agency or invoked other procedural mechanisms, that is not required.  Importantly, the possibility of a possibility is not enough to defeat preemption. And there is no need to force these obviously litigation-driven steps.

We also like, in the discussion of whether the FDA was fully informed of the risk that plaintiffs are now complaining about, how the court noted that the FDA alone is the arbiter of which data and information is or is not material to its decision to approve or reject a change to a drug’s label; it is the FDA’s view of the evidence that matters, as opposed to only plaintiffs’ experts’ view.  Typically, plaintiffs will hire a “regulatory expert” who tries to opine about not only what the FDA would have done or said, and what the agency really meant to say, but also what evidence the FDA would have considered relevant or material, regardless of Agency regulations, guidance, and statements about what they considered and what they find important.

When the FDA is fully informed, from whatever source, of the alleged risks, then a huge hurdle exists for plaintiffs trying to show that a manufacturer could have changed the label unilaterally.  It is the inability to do so that sets up the conflict, the impossibility of complying with plaintiffs’ view of state law (requiring a warning) and federal law (dictating the label as is).  A CBE change, the court reiterated, permits a drug manufacturer to unilaterally add a precaution to its label, but only if newly acquired information provides reasonable evidence of a causal association of a clinically significant adverse reaction linked to a drug. If the FDA was fully informed at the relevant time, then there is no newly acquired information.

Another common plaintiff argument has been that the agency must reject the formal request of the kind plaintiff thinks the manufacturer should have made, procedurally.  But the court explained that a rejection of a PAS request subsumes any request under the CBE avenue.  And final agency action, for preemption purposes, can include a “complete response letter” because it reflects the FDA’s complete review of the data submitted.  Importantly, for  preemption purposes, it is mostly irrelevant whether the the FDA letter was of a merely tentative or interlocutory nature or needed some additional FDA action to close out the record, or leave some procedural door open for a party to ask again.

Finally, and this is a drum we have been banging on for a while, silence can be golden.  That is, the FDA has a statutory obligation to respond to any product-related information it receives, from any source, such as Adverse Event Reports, published studies, etc.  Plaintiffs want the courts facing preemption challenges to simply ignore the FDA’s raison d’etre to regulate drug safety,  and its independent legal duty to notify a manufacturer as soon as it becomes aware of new safety information that the FDA believes should be included in the labeling of a drug, and to initiate discussions about new labeling. Courts should not simply assume that the FDA has not done what the statute requires it to do, as opposed to having done it and come to a conclusion (no action needed) that plaintiffs do not like.  Indeed, said the court, the only valid inference is that the FDA was unconvinced of an issue requiring amendment, here that the Agency did not believe there was reasonable scientific evidence of a causal association between bisphosphonate use and atypical femoral fractures. And related to this, the FDA will not approve a warning simply out of an abundance of caution whenever a manufacturer posits an association between a drug and an adverse event. As the FDA has long recognized, exaggeration of risk, or inclusion of speculative or hypothetical risks, could discourage appropriate use of a beneficial drug. Because labeling that includes theoretical hazards not well-grounded in scientific evidence can cause meaningful risk information to lose its significance, the FDA prohibits a change to labeling, either through the PAS or CBE process, to add a Precautions warning in the absence of sufficient reasonable evidence of an association. This represents a more conservative approach than state tort law, which generally incentivizes a manufacturer to warn about every conceivable hazard to limit liability.

Today’s case involves a New York federal court dismissing a proposed class action alleging that the labeling on  “slightly sweet” chai tea lattes misleads consumers into thinking the drinks are low in sugar. Brown v. Kerry Inc., No. 1:20-cv-09730 (S.D.N.Y. 3/7/22).

Plaintiff asserted claims under the NY General Business law, and common law negligent misrepresentation, fraud, and unjust enrichment.  Relying on the analysis of the magistrate judge, the district court dismissed all claims.

The court noted that above the product’s name are the phrases “Slightly Sweet” and “A Less Sweet Twist on Our Authentic Chai.”  On the back label,
beneath the language “Slightly Sweet Chai Tea Latte,” the label states: “We get it – you have a particular palate. We’ve taken our original recipe . . . and removed some sweetness for those who know exactly what they want.”  Plaintiff claimed that she and other consumers are led to believe – based on the
“Slightly Sweet” language – that the product is low in sugar, when in fact each serving contains eleven grams of sugar, which allegedly exceeds the regulatory definition of low sugar products

Defendant argued that label was  not “materially misleading,” an element, because (1) “Slightly Sweet” describes flavor rather than its ingredients;
(2) “Slightly Sweet” is non-actionable puffery; and/or (3) the packaging – including the nutritional information printed on the side label – dispels any potential confusion regarding the Product’s sugar content. In rejecting plaintiff’s argument that the “Slightly Sweet” language is “materially
misleading,” the court was not required to accept plaintiff’s conclusory allegations that reasonable consumers would construe the allegations as misleading.

The court went on to conclude that the “Slightly Sweet” label language is “mere puffery,” because “it provides no objective measurement or indication of the amount of sugar in the product, and refers instead to a subjective claim about the Product’s level of sweetness that cannot be proven either true or false.” See Sommer v. Snapple Beverage Corp., No. 20-CV-04181-JST, 2021 WL 6754525 (N.D. Cal. Sept. 20, 2021) (tea beverage labeled as “Sorta Sweet”); Mazella v. Coca-Cola Co., 548 F. Supp. 3d 349 (S.D.N.Y. 2021) (tea beverage labeled as “Slightly Sweet”); Salazar v. Honest Tea, Inc., 74 F. Supp. 3d 1304 (E.D. Cal. 2014) (tea beverage labeled as “just a tad sweet”)).

The opinion also notes that the “context of the label as a whole” suggests that “Slightly Sweet” is a representation about the product’s “taste profile, rather than the amount of sugar” it contains. In this regard, the label addresses sweetness in the context of consumers’ “palates.” And the product’s nutritional information – which is also part of the label – “explicitly states the amount of sugar and number of calories” in the product. The nutritional information “dispel[s]” “any ambiguity or confusion regarding the Product’s sugar content.”

Finally, the court found plaintiff’s proffered consumer survey data unpersuasive, noting that the surveys did not actually “demonstrate[e] that consumers understand ‘Slightly Sweet’ to mean ‘low sugar’ or ‘low calorie.’”

Another case in the tug of war between manufacturers wanting to describe their products in both an appealing and accurate way, and the plaintiff bar’s microscopic scrutiny of food and beverage labels.