This post is from the non-Reed Smith side of the blog.
We’ve put it off long enough – time to deal with the awful decision in C.R. Bard v. Cisson, __ F.3d __, 2016 WL 158814 (4th Cir. Jan. 14, 2016). When we posted our 2015 Top Ten, we noted that we were watching Cisson because it had the potential to be among our top or bottom 10 of 2016. Well, the top is definitely off the table and while it’s still early, the bottom is certainly in the running.
A quick background of the case. Cisson is an appeal from the first trial in the massive Pelvic Mesh MDL. Plaintiff underwent implantation of defendant’s pelvic mesh device and began experiencing pain. Two years later, she had surgery to remove the device, but the “arms” of the device could not be removed. Id. at *1. In 2013, defendant won summary judgment on many of plaintiff’s claims leaving only design defect and failure to warn to proceed to trial. Id. at *2. The trial resulted in a plaintiff verdict, including a sizeable punitive damages award. Id. at *1.
On appeal, defendant challenged several of the court’s evidentiary rulings, which is a tough row to hoe given the discretionary standard of review. Chief among those was the district court’s decision to exclude any evidence of defendant’s compliance with the FDA 510k clearance process – finding it both irrelevant and unduly prejudicial. As we pointed out earlier, considerable precedent allowed admission of FDCA compliance into evidence, including compliance with §510k clearance procedures. But downright irrelevant? Really? The process established by the industry’s primary regulator as to what the industry must do and how it must do it in order to be able to bring its product to market is irrelevant? At least the Fourth Circuit did not go that far. It acknowledged that the question of relevance is “more difficult,” id. at * 6; perhaps a slight nod that if it had to rule on that issue it might have disagreed with the district court. Unfortunately, the appellate court still affirmed, holding under Rule 403’s less demanding “prejudice” standard that the district court did not abuse its discretion in excluding the 510k clearance as unduly prejudicial.
The first question in determining whether evidence is admissible under Rule 403 is whether it is probative of an issue in the case. Here, under Georgia’s risk-utility test for design defect claims, one of the questions for the jury is whether the defendant acted reasonably in designing the product. Id. at *3. Certainly there should be little dispute that compliance with the 510k process goes to reasonableness. At a minimum, the fact of compliance, clearance, and a description of that process is evidence that addresses plaintiff’s inevitable arguments of what the company did and didn’t do, and what it should and shouldn’t have done. To omit the 510k clearance would be to present the jury with a falsehood, a void, a gaping whole – which should be filled with the truth – that the company played by the rules.
Putting aside that sort of common sense argument, the general state-law rule is that a product’s compliance with FDA regulations is relevant, albeit not controlling, in product liability litigation.
[A] product’s compliance with an applicable product safety statute or administrative regulation is properly considered in determining whether the product is defective.
Restatement (Third) of Torts, Products Liability §4(b) (1998).
The Fourth Circuit, however, belittled the probative value of compliance with the 510k process by mistakenly concluding that it has nothing to do with safety. Id. at *3. Indeed, the Fourth Circuit went so far off base as to state that the 510k clearance process allows some medical devices to “avoid” “safety testing.” Id. Again, we are left shaking our heads at such contrafactual conclusion. The 510(k) process is not a complete abandonment of safety considerations. As we have written before, while the 510(k) clearance is premised on substantial equivalence, such clearance does necessarily constitute a finding of safety. Congress enacted the 510(k) process, in part, to enable quicker clearance for new devices that are equivalent to devices that have already been on the market and have accumulated some sort of safety and efficacy record.
But the court misapplied to evidence the Supreme Court’s preemption language in Lohr v. Medtronic:
Thus, even though the FDA may well examine 510(k) applications ... with a concern for the safety and effectiveness of the device,” the agency’s clearance rests only on whether the device is “substantially equivalent to one that existed before 1976” before allowing it “to be marketed without running the gauntlet of the [MDA premarket approval] process.
Cisson, at *4 (quoting Lohr, 518 U.S. 470 at 493-94 (1996)). But the preemption cases have nothing to do with the admissibility of evidence. Indeed, our prior post on this topic contains a sizeable number of cases that reject preemption but are accompanied by statements affirming the admissibility of FDA compliance. So while the Fourth Circuit was correct that the Supreme Court “found the 510k process insufficiently tied-up with safety to preempt state tort actions,” id., that court wasn’t being asked to decide preemption. It was asked whether the jury could hear evidence of compliance with industry standards. Juries hear evidence on industry standards all the time. And they receive instructions from the court all the time on how to weigh that evidence. There seems to be little reason why that wouldn’t have worked well here. Just because 510(k) clearance doesn’t preempt a plaintiff’s claims, it doesn’t mean that evidence of such clearance should disappear from trial.
Moreover, things have changed since 1996, including the 510k process. But the court ignored both the actual changes to the 510k process since Lohr and recent FDA guidance that “the principles of safety and effectiveness underlie the substantial equivalence determination that is the heart of the 510k process.” Id. at *4. We also point you to a guest post that explains that not all 510k clearances are premised on pre-1976 products. This is true of pelvic mesh and its regulatory history. We won’t repeat it here, but it is hard to imagine how anyone could argue that the current 510k process is so divorced from safety review that it is “prejudicial” even to mention it to a jury.
Having downplayed the significance of the compliance evidence, the Fourth Circuit next examined the district court’s conclusion that admission of this evidence would create an unnecessary “mini-trial” on the 510(k) process itself and defendant’s compliance with it. How is that different from admission of compliance – or non-compliance, for that matter − with any regulatory scheme? It is the same drill – one side wants to highlight the importance of compliance, while the other tries to minimize it. What is peculiar to FDCA 510k compliance, as opposed to motor vehicle OSHA standards? Cisson held that the jury would be misled or confused and that it might improperly “inflate” the importance of the evidence. Id. at *5. That the jury would be distracted from the central question – whether defendant acted reasonably in designing the device. Id. As noted above, we can’t conceive of a discussion of reasonableness that doesn’t include compliance with FDA regulations. The 510(k) process regulates the manner in which medical devices are developed, designed, manufactured and labeled. It’s not everything. But it’s a big enough piece of it for the jury to hear about. Given that, it’s hard to imagine how the jury is anything but hamstrung by not having evidence as to how that process played out with this product. It was provided with a false version of reality.
We think the 510k clearance process was a substantial piece of evidence that would be wrongly excluded in any case. But in a Georgia punitive damages case, exclusion is even more egregious. Georgia is one of the best states in the country for punitive damages not being available where relevant government regulations are complied with. See generally Hernandez v. Crown Equip. Corp., 92 F. Supp. 3d 1325, 1356 (M.D. Ga. 2015) (discussing critical role that compliance plays in precluding punitive damages). So in essence, when the court excluded 510k compliance it also excluded a major state law defense to punitive damages because it might be difficult to understand. What? When something’s “hard” you just skip it? Defendant was robbed of a potentially complete defense to punitive damages, again based on complete misperception by the court of what the 510k process is. That’s a bad result. “For one thing, the Due Process Clause prohibits a State from punishing an individual without first providing that individual with an opportunity to present every available defense.” Philip Morris USA v. Williams, 549 U.S. 346, 353 (2007).
One final point on the compliance issue. Does Cisson mean that, where a plaintiff is claiming some sort of violation, say a warning letter or form 483 concerning a 510k device, that non-compliance evidence remains too “prejudicial”? Or is 510k clearance an application of the all-too-common plaintiff-side logic of “heads I win, tails you lose”?
Other issues were raised on appeal in Cisson, most notably a hearsay challenge to a material data safety sheet (“MSDS”) pertaining to one of the materials used in defendant’s pelvic mesh product. Defendant challenged its admission as hearsay. The district court ruled that it was admissible as non-hearsay to show notice – that defendant was aware of it, but also went on to sua sponte rule that it was admissible hearsay under several hearsay exceptions. The Fourth Circuit disagreed. In particular, the MSDS failed the “generally relied upon” hearsay exception provided by F.R. Evid. 803(17). An MSDS wasn’t sufficiently “trustworthy” because “[d]isclaimers of the sort in the MSDS are not typically so motivated, being intended instead to prevent any use of a product that might create a liability.” 2016 WL 158814, *7. Since this MSDS was essentially the supplier’s attempt to cover its derriere, it was inadmissible hearsay. In the end, however, the plaintiff skated again, because despite the erroneous hearsay rulings, the MSDS could be admissible for notice, and the Fourth Circuit concluded that any error was “harmless” under the indulgent abuse of discretion standard of review for evidentiary issues. Supposedly, because plaintiff only crossed the line (presenting the MSDS for its truth rather than for notice) once. Id. at *11-12. All we can hope is that recognition of the untrustworthy nature of a supplier’s MSDS may be helpful in future pelvic mesh cases, which is cold comfort to the defendant assailed by bogus arguments in Cisson itself. Perhaps conceding notice would keep the MSDS out altogether.
Except for the original district court decision on the issue of the admissibility of compliance with the 510k process, Cisson is the worst decision we know of on this subject. It is based in part on excerpts of preemption decisions used out of context and in part on an excuse that it would be confusing for the jury to hear about compliance, a key defense that is almost universally recognized. And to do so in a punitive damages case? Either aspect would cause sufficient dismay on their own, combined it’s a gross miscarriage of justice and denial of due process.