What's Legal After Riegel? As Courts Strike Claims, Congress Mulls Action

Federal preemption—an obscure legal doctrine usually relegated to the dry pages of academic journals—has attracted mainstream media attention after recent Supreme Court rulings limiting individual lawsuits against federally regulated industries.

Approved products have drawn much of the attention, especially after the court's 2008 decision in Riegel v. Medtronic. Riegel struck down a common-law product liability claim that would have required the manufacturer of a balloon catheter to depart from the design, warnings and manufacturing procedures specifically approved by the FDA.

Riegel Preempts Many Device Claims, But Leaves the Lohr Door Open

News coverage has focused on sympathetic stories of uncompensated injuries, conveying a sense that preemption unjustly grants blanket immunity to medical technology firms while cutting off patients' rights. In an editorial following the Riegel decision, the New York Times argued that "[i]f this perverse legal doctrine … continues to spread, the public will be deprived of a vital tool for policing companies and unearthing documents that reveal their machinations."

Some in Congress—most notably Rep. Henry Waxman, veteran industry critic and chair of the House Committee on Oversight and Government Reform—are promising legislation to eliminate preemption and throw open the doors to mass litigation against manufacturers of FDA-approved products.

But less attention has been paid to the fact that even after Riegel, not all device-related claims are preempted. For one thing, Riegel let stand the Court's 1996 decision in Lohr v. Medtronic, reaffirming the distinction between the exhaustive "federal requirements" of the PMA process and the looser scrutiny of 510(k) notification. This means that 510(k) devices—which vastly outnumber PMA devices—remain fully exposed to mass-tort liability, as the Court held in Lohr.

Moreover, even for PMA devices, lower courts disagree on the scope of preemption after Riegel. Most courts have held that Riegel eliminates all tort claims against approved devices. In one recent case, however, a federal court in Indiana allowed product liability claims to proceed against an approved device because it was later the subject of an FDA recall. To the extent other courts follow this court's reasoning, there may be little or no drop in filings against device manufacturers, since most mass-tort device litigation involves recalled products.

Thus, the fear that preemption will cause the wholesale extinction of medical mass-torts appears overblown. The real public health challenge predates Riegel and the current controversy over preemption, and that is: How to weigh the few inevitable bad outcomes against the health benefits for a multitude?

During the approval process, FDA attempts to strike the risk/benefit balance prospectively, in order to achieve the greatest good for the greatest number. Tort litigation, by contrast, always looks back through the eyes of the injured litigant and often loses sight of the good that devices do for others. From this standpoint, federal preemption provides a check on juror sympathies, and reminds us that medical devices are approved based on a thorough, though necessarily imperfect, assessment of their anticipated benefit to society. Perhaps that isn't such a bad thing.

Preemption Promotes Uniform Standards

The legal concept behind preemption is straightforward: Congress has the power under the Constitution to "preempt" state laws and regulations that conflict with or exceed the requirements of federal law. Generally speaking, Congress must say it intends a federal statute to override comparable state laws, although in some circumstances the federal requirements may be so comprehensive and exhaustive that they "occupy the field" and "impliedly preempt" states from implementing their own rules. State interference with federal law is not limited to statutes and regulations; the Supreme Court has held that verdicts and court decisions under state common-law are just as disruptive, and therefore also subject to preemption.

Preemption decisions are often driven by the practical reality that it is generally fairer and more efficient for companies to follow a uniform, nationwide set of rules than to attempt to meet the varying and idiosyncratic standards of 50 different states. This is especially true for medical mass-tort litigation, where differences from one state to another, and even within states, confound efforts to anticipate the legal standards to which the company will be held. The problem is further compounded by the fact that a jury in Wyoming or Kansas may view the same conduct completely differently than one in Louisiana or Florida. It is not unusual for a medical manufacturer to successfully defend its product in one state, only to suffer a ruinous verdict in another.

Riegel Favors FDA Expertise in Public Health Decisionmaking

For medical devices, the Supreme Court has also commented that the FDA's scientific expertise is entitled to some weight, at least when compared to the relative lack of expertise among judges and jurors. During oral argument last term in Warner Lambert v. Kent, Justice Breyer expressed this through a rhetorical question to the plaintiffs' attorney:

The court gave its answer to that question in Riegel, holding that state-court verdicts are "less deserving of preservation" because "[a] jury … sees only the cost of a more dangerous design, and is not concerned with its benefits; the patients who reaped those benefits are not represented in court."

Thus, Riegel clarifies that pronouncements about the safety and effectiveness of prescription medical devices should come from the experts at the FDA, and not from the plaintiffs' bar. A PMA-approved device must "be made with almost no deviations from the [approved] specifications, for the reason that the FDA has determined that the approved form provides a reasonable assurance of safety and effectiveness." No therapy can be safe and effective for every patient. The fact that some patients will not respond to treatment, or worse, be harmed by it, does not necessarily upset the risk/benefit balance struck by the FDA during the approval process.

Does Preemption Still Apply When an Approved Device Gets Recalled?

Riegel left at least one big question unanswered: What happens when an approved device gets recalled? If the FDA directs a manufacturer to recall its product, is it "taking back" the approval, thereby exposing the manufacturer to tort liability? Can state-law tort actions still be said to conflict with federal requirements in cases where those requirements have been violated? Or should the agency still retain exclusive authority to decide the product's fate, without interference from injured patients and their lawyers?

Two recent lower-court decisions show widely divergent interpretations of Riegel's impact on these issues, and may eventually force the Supreme Court to take up the issue again—that is, if Congress doesn't get there first.

In In re Medtonic Sprint Fidelis Leads Product Liability Litigation, a Minnesota federal court held that Riegel mandates preemption for recalled devices, extinguishing hundreds of claims in one stroke. This was the first case to apply Riegel to a mass-tort, and the dust has yet to clear since the decision was handed down on January 5.

The Sprint Fidelis story reads like many other device mass-torts. Medtronic's Sprint Fidelis leads were implanted in some 268,000 patients starting in 2004. Concerns arose in 2006 that the leads were developing cracks in the outer sleeve, exposing some patients to multiple inappropriate shocks. In late 2007, the company initiated a class 1 recall of the leads, which escalated the steadily growing number of patient lawsuits. The cases were consolidated for pre-trial management before Hon. Richard H. Kyle on February 21, 2008—one day after the Supreme Court issued its ruling in Riegel.

In applying the law of Riegel to the facts of Sprint Fidelis, the court held the device's PMA approval was not invalidated by the subsequent recall. No statutes or regulations support the notion that a recall, without more, is sufficient to void an approved PMA. Further, the court emphasized that plaintiffs' claims, if allowed to proceed, would interfere with the PMA process by "retroactive[ly] second-guessing" the FDA's decision to approve the device in the first place. After Riegel, a state-court jury can no longer "Monday-morning quarterback" the agency's judgments.

The court did not hide from the impact of its ruling, acknowledging that "at least some plaintiffs have suffered injuries from using Sprint Fidelis leads." Nevertheless, "Congress has decided to limit medical-device manufacturers' liability in order to spur innovation, even though individuals are sometimes injured when using medical devices." It therefore follows that "Plaintiffs' remedy … is with Congress, and not with this Court (or any other court)." In other words: "Don't blame me, write your Congressman."

Confronting the same issue as in Sprint Fidelis—whether tort claims are preempted for recalled devices—an Indiana federal court recently made an opposite ruling, and allowed the plaintiff's claims to proceed. Judge David F. Hamilton, quoting Riegel, argued that preemption only applied to claims that an approved device "violated state tort law notwithstanding compliance with the relevant federal requirements"—in other words, if a device were later found to have violated its approved requirements, it would no longer qualify for protection from state tort claims.

The court's ruling draws support from the fact that Riegel did not overrule Lohr, which suggests that some state-law claims may still be permissible as "identical or parallel to the FDA's federal requirements." In the court's view, "[i]f the law were otherwise … then Riegel and the [Medical Device Amendments to the Food Drug and Cosmetic Act] would be turned upside down and Lohr would be overruled."

Hofts does not refer the issue to Congress, as in Sprint Fidelis. Instead, the court distinguishes the Sprint Fidelis ruling as "unusually stringent," and expresses its disapproval of what it perceives to be efforts "to stretch Riegel beyond recognition" by "transforming its protection for FDA-approved devices that comply with federal law into a grant of civil immunity for FDA-approved devices that violate federal law."

Thus far, Hofts represents a minority view among post-Riegel decisions, virtually all of which have dismissed the plaintiffs' claims as preempted. Whether Hofts has started a countervailing trend remains to be seen.

Will Congress Enact a Preemption Exemption?

As noted, Sprint Fidelis put patients' lack of a remedy for injuries caused by approved devices squarely on Congress's shoulders. How will Congress respond? U.S. Representatives Pallone and Waxman introduced draft legislation entitled the "Medical Device Safety Act of 2008" last June. A similar Senate bill was introduced by Sens. Edward M. Kennedy and Patrick J. Leahy.

But this legislation preceded the Lehman Brothers collapse, congressional bailout of the banking industry, worsening credit crisis—and the steady drumbeat of dire economic news. While both bills are expected to be reintroduced, the ailing economy is likely to preempt these "preemption reform" efforts in the coming months.