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Alton v. Medtronic, Inc.

United States District Court, D. Oregon

September 6, 2013

RICHARD D. ALTON, Plaintiff,

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[Copyrighted Material Omitted]

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[Copyrighted Material Omitted]

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For Richard D. Alton, Plaintiff: Cecilia Han, Kent L. Klaudt, Lisa J. Cisneros, LEAD ATTORNEYS, PRO HAC VICE, Lieff Cabraser Heimann and Bernstein, LLP, San Francisco, CA; Todd A. Bradley, LEAD ATTORNEY, Gaylord Eyerman Bradley, P.C., Portland, OR; Wendy R. Fleishman, LEAD ATTORNEY, PRO HAC VICE, Lieff Cabraser Heimann and Bernstein, LLP, New York, NY.

For Medtronic, Inc., a Minnesota corporation, Medtronic Sofamor Danek USA, Inc., Defendants: Michael K. Brown, LEAD ATTORNEY, PRO HAC VICE, Reed Smith LLP, Los Angeles, CA; Nancy M. Erfle, LEAD ATTORNEY, Gordon & Rees LLP, Portland, OR.


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Honorable Paul Papak, United States Magistrate Judge.

Plaintiff Richard D. Alton filed this action against defendants Medtronic, Inc., and Medtronic Sofamor Danek USA, Inc. (collectively, " Medtronic" ) on March 11, 2013, alleging claims of fraudulent misrepresentation and fraud in the inducement, strict products liability for failure to warn, strict products liability for defective design, strict products liability for misrepresentation, products liability for negligence, and breach of express warranty. Each of Alton's claims arises out of complications he suffered following spine surgery in which a medical device designed, produced, and marketed by Medtronic was implanted in his cervical spine. This court has jurisdiction over Alton's claims pursuant to 28 U.S.C. § 1332, based on the complete diversity of the parties' citizenship and the amount in controversy.

Now before the court are Medtronic's motion (#19) to dismiss Alton's claims, Medtronic's motion (#23) for judicial notice, and Alton's motion (#26) for judicial notice. I have considered the motions, oral argument on behalf of the parties, and all of the pleadings and papers on file. For the reasons set forth below, Medtronic's motion (#23) and Alton's motion (#26) for judicial notice are each granted as discussed below, and Medtronic's motion (#19) to dismiss is granted in part and denied in part as discussed below.


I. Request for Judicial Notice

Federal Rule of Evidence 201(d) provides that " [a] court shall take judicial notice [of an adjudicative fact] if requested by a party and supplied with the necessary information." An adjudicative fact is subject to judicial notice when the fact is " not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot be reasonably questioned." Fed.R.Evid. 201(b).

II. Motion to Dismiss

To survive dismissal for failure to state a claim pursuant to Rule 12(b)(6), a complaint must contain more than a " formulaic recitation of the elements of a cause of action; " specifically, it must contain factual allegations sufficient to " raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). To raise a right to relief above the speculative level, " [t]he pleading must contain something more . . . than . . . a statement of facts that merely creates a suspicion [of] a legally cognizable right of action." Id., quoting 5 C. Wright & A. Miller, Federal Practice and Procedure § 1216, pp. 235-236 (3d ed. 2004); see also Fed.R.Civ.P. 8(a). Instead, the plaintiff must plead affirmative factual content, as opposed to any merely conclusory recitation that the elements of a claim have been satisfied, that " allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). " In sum, for a complaint to survive a motion to dismiss, the non-conclusory 'factual content,' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. United States Secret Serv.,

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572 F.3d 962, 970 (9th Cir. 2009), citing Iqbal, 129 S.Ct. at 1949.

" In ruling on a 12(b)(6) motion, a court may generally consider only allegations contained in the pleadings, exhibits attached to the complaint, and matters properly subject to judicial notice." Swartz v. KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007). In considering a motion to dismiss, this court accepts all of the allegations in the complaint as true and construes them in the light most favorable to the plaintiff. See Kahle v. Gonzales, 474 F.3d 665, 667 (9th Cir. 2007). Moreover, the court " presume[s] that general allegations embrace those specific facts that are necessary to support the claim." Nat'l Org. for Women v. Scheidler, 510 U.S. 249, 256, 114 S.Ct. 798, 127 L.Ed.2d 99 (1994), quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). The court need not, however, accept legal conclusions " cast in the form of factual allegations." Western Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981).


Alton's complaint in this matter is voluminous, as are the materials submitted to the court as fit matters for judicial notice. In consequence, I provide here only a brief summary of the material allegations and facts.

On July 2, 2002, Medtronic received pre-market approval (" PMA" ) from the federal Food and Drug Administration (the " FDA" ) for its Infuse device (a " Class III" medical device under the classification framework of the Medical Device Amendments of 1976). The Infuse device approved by the FDA consists of a recombinant bone morphogenetic protein referred to as rhBMP-2 used in connection with a collagen scaffold (sponge) and a tapered metallic spinal fusion cage (interbody cage). The Infuse device was specifically approved as of July 2, 2002, for use in surgery on the lumbar spine performed through the abdomen (an anterior approach; this procedure is referred to as anterior lumbar interbody fusion surgery, or " ALIF" ). Certain alternate interbody cage designs were approved by the FDA on December 1, 2003. The FDA subsequently approved the Infuse device for use in repairing certain tibia fractures and certain oromaxillary surgeries, and approved the Infuse rhBMP-2 protein component for use in the absence of the sponge or any interbody cage in certain sinus augmentations and alveolar ridge augmentations.

At or around the time it obtained initial FDA approval for the Infuse device, Medtronic began expending large sums of money in efforts to promote so-called " off-label" uses of the device, namely, any application other than those specifically approved by the FDA. These off-label applications included the use of the rhBMP protein without the specific interbody cage approved by the FDA as part of the Infuse device in connection with lumbar spine surgeries with a transforaminal or posterior approach (referred to as posterior lumbar interbody fusion or " PLIF" surgery).

Even before it obtained FDA approval for any application of the Infuse device, Medtronic was aware of studies demonstrating that applications of the device other than those ultimately approved by the FDA were associated with significant adverse consequences, sometimes resulting in conditions of the spine that were worse than the condition necessitating surgical intervention in the first instance, in some cases life-threatening conditions. Specifically, off-label applications of the device

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such as PLIF surgery resulted, in a high percentage of applications, in " exuberant bone growth" (sometimes referred to as " ectopic bone growth" ) in the location where the bone protein component of the device was applied. Medtronic did not report these adverse results to the FDA, and to the contrary suppressed information regarding adverse consequences in the course of its efforts to promote off-label applications such as PLIF.

As a result of Medtronic's efforts to promote off-label applications of the device and applications of components of the device and of Medtronic's efforts to suppress reports of adverse consequences from such applications, by 2010 the Infuse device and its protein component were more frequently used off label than for approved applications, and became a huge source of profit for Medtronic.

On April 7, 2010, Alton underwent PLIF surgery in which the protein component of the Infuse device was implanted in his lumbar spine without the appropriate interbody cage. At the time he conducted the surgery, Alton's surgeon was unaware of known risks associated with such application of the protein component of the device, due to Medtronic's suppression of information regarding such risks. Alton subsequently developed uncontrolled exuberant bone growth in his lumbar spine, necessitating further surgery and resulting in significant pain symptoms.


I. Parties' Requests for Judicial Notice

By and through its motion (#23) for judicial notice, Medtronic requests that the court take notice of documents constituting: (i) the FDA PMA database listing for the Infuse device indicating a July 2, 2002, decision date approving the device for spinal fusion procedures in skeletally mature patients with degenerative disc disease at one level from L4-S1; (ii) the FDA's PMA letter for the Infuse device dated July 2, 2002, approving the device for spinal fusion procedures in skeletally mature patients with degenerative disc disease at one level from L4-S1; (iii) a supplemental FDA PMA database listing for the Infuse device indicating a March 27, 2013, supplemental decision date approving a modification to the process for using the device, specifically the addition of an alternate water supplier; (iv) a supplemental FDA PMA database listing for the Infuse device indicating a December 1, 2003, supplemental decision date approving a modification to the device, specifically the addition of alternate interbody cage designs; (v) the FDA's PMA letter for the rhBMP-2 protein dated April 30, 2004, approving the protein for the treatment of acute, open tibial shaft fractures stabilized with intramedullary nail fixation in skeletally mature patients; (vi) the FDA's PMA letter for the rhBMP-2 protein dated March 9, 2007, approving the protein for sinus augmentations and for localized alveolar ridge augmentations for defects associated with extraction sockets; (vii) an FDA " Important Medical Information" advisory regarding the Infuse device and the rhBMP-2 component thereof; [2] and (viii) the FDA's " Summary of Safety and Effectiveness Data" for the Infuse device. By and through his motion

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(#26) for judicial notice, Alton requests that the court take notice of documents constituting: (i) an FDA " Important Medical Information" advisory regarding the Infuse device and the rhBMP-2 component thereof (identical to the seventh-enumerated document of which Medtronic requests judicial notice); (ii) a " Staff Report on Medtronic's Influence on Infuse Clinical Studies" prepared by the staff of the United States Senate Finance Committee and dated October 2012; [3] (iii) an August 20, 2012, " Notice of Ruling" issued by the Los Angeles County Superior Court of the State of California denying Medtronic's motion for summary judgment in Case No. BC465313, a products liability action arising out of an application of the Infuse device; (iv) a June 22, 2012, Judgment of Dismissal issued by the Los Angeles County Superior Court of the State of California dismissing product liability claims against Medtronic in Case No. SC112290; (v) a February 21, 2013, court order issued by a trial court of the State of Colorado in Case No. 12CV40 denying Medtronic's motion to dismiss claims brought against it in connection with an off-label use of the rhBMP-2 protein for spinal surgery without an interbody cage; (vi) a March 5, 2013, court order issued by the Miami-Dade County Circuit Court of the State of

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Florida denying Medtronic's motion to dismiss in an action against it; (vii) an October 2, 2008 release by the United States Senate Finance Committee of a September 20, 2008, letter from Senator Grassley to Medtronic regarding its financial relationships with private physicians; (viii) a June 22, 2011, release by the United States Senate Finance Committee of a June 21, 2011, letter from Senators Baucus and Grassley to Medtronic regarding evidence and press reports that " doctors conducting clinical trials examining the safety and effectiveness of Infuse . . . were aware that Infuse . . . may cause medical complications, but failed to report this in the medical literature," an " issue . . . compounded by the fact that some clinical investigators have substantial financial ties to Medtronic; " (ix) a December 13, 2011, letter from Senators Blumenthal, Grassley, and Kohl to Medtronic requesting information as to how Medtronic " handles recalls and post-marketing surveillance of [its] products; " and (x) a January 17, 2012 judgment of the United States District Court for the District of Massachusetts in criminal Case No. 09-10330-GAO reflecting the guilty plea of defendant Stryker Biotech, LLC, to distributing a misbranded device.

Neither party requests with particularity that the court take notice of any specific adjudicative fact set forth within any of the identified documents, but rather each party appears to request that the court take notice of the contents of all of the identified documents generally. It is clear that each identified document contains adjudicative facts capable of ready determination, but equally clear that at least some of the identified documents contain content that does not constitute such an adjudicative fact. Nevertheless, because each identified document sets forth at least some fit matters for judicial notice, the parties' motions are granted, and I take judicial notice of adjudicative facts contained within the identified documents. Other content of the identified documents has been and will be disregarded.

II. Medtronic's Motion to Dismiss

By and through its motion to dismiss, Medtronic chiefly argues that each of Alton's claims is preempted under the federal Food, Drug, and Cosmetic Act of 1938 (the " FDCA" ), and in the alternative argues that Alton's design defect claim is barred under Restatement of (Second) Torts Section 402A, Comment k, that his breach of express warranty claim necessarily fails because Medtronic has disclaimed all express warranties, and that his fraud claim necessarily fails because it is not pled with adequate particularity. I address each set of arguments in turn below.

A. Preemption Under the FDCA

1. The FDCA Preemption Framework

By and through the Food and Drug Act of 1906 (the " 1906 Act" ), Congress prohibited the manufacture or shipment through interstate commerce of any adulterated or misbranded food or drug. In 1938, through passage of the FDCA, Congress broadened the coverage of the 1906 Act to include within its scope adulterated or misbranded medical devices and cosmetics. As originally enacted, however, the FDCA did not provide any mechanism for governmental oversight of the process of introducing new medical devices.

In 1976, by and through the Medical Device Amendments of 1976 (the " MDA" ), Congress enacted significant amendments to the FDCA. Under the FDCA as modified by the MDA, medical devices are classified into three categories based on the potential risk they pose. Devices posing the greatest risk are classified as " Class III" devices. See 21 U.S.C. § 360c(a)(1)(C).

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Before a new Class III device may be introduced to the market, the manufacturer must provide the FDA with a " reasonable assurance" that the device is both safe and effective. See 21 U.S.C. § 360e(d)(2). Despite its relatively innocuous phrasing, the process of establishing this " reasonable assurance," which is known as the " premarket approval," or " PMA" process, is a rigorous one.

Medtronic, Inc. v. Lohr, 518 U.S. 470, 477, 116 S.Ct. 2240, 135 L.Ed.2d 700 (1996). Indeed, the Supreme Court has characterized the premarket approval (" PMA" ) process as constituting the Congressionally mandated " federal safety review" process. Riegel v. Medtronic, Inc., 552 U.S. 312, 323, 128 S.Ct. 999, 169 L.Ed.2d 892 (2008) (" Premarket approval. . . is in no sense an exemption from federal safety review--it is federal safety review" (emphasis original)).

A manufacturer's obligations under the FDCA do not end with premarket approval. Even after premarket approval issues, manufacturers are required to report to the FDA " no later than 30 calendar days after the day" the manufacturer " receive[s] or otherwise become[s] aware of information, from any source, that reasonably suggests that a device" marketed by the manufacturer:

(1) May have caused or contributed to a death or serious injury; or
(2) Has malfunctioned and this device or a similar device [likewise marketed by the manufacturer] would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur.

21 C.F.R. § 803.50(a); see also 21 U.S.C. § 360i(a) (further detailing the post-approval reporting requirements applicable to device manufacturers); Riegel, 552 U.S. at 319; Stengel v. Medtronic Inc., 704 F.3d 1224, 1226-1227 (9th Cir. 2013) ( en banc ). In addition, manufacturers are required to make periodic reports to the FDA regarding approved devices, such reports to include summaries of:

(i) Unpublished reports of data from any clinical investigations or nonclinical laboratory studies involving the device or related devices and known to or that reasonably should be known to the applicant.
(ii) Reports in the scientific literature concerning the device and known to or that reasonably should be known to the applicant.

21 C.F.R. § 814.84(b)(2).

The FDCA does not prohibit nor purport to regulate the use by physicians of medical devices for applications that have not been approved by the FDA (so-called " off-label" applications). Indeed, the off-label application of medical devices is not discouraged by the FDA, and is generally accepted to be both necessary and valuable. See, e.g., Buckman Co. v. Plaintiffs' Legal Comm., 531 U.S. 341, 350, 121 S.Ct. 1012, 148 L.Ed.2d 854 (2001). However, the FDCA as amended by the MDA expressly prohibits manufacturers from the " introduction or delivery for introduction into interstate commerce of any . . . device. . . that is . . . misbranded." 21 U.S.C. § 331(a). A device is misbranded under the FDCA as amended if, inter alia, " its labeling is false or misleading in any particular," 21 U.S.C. § 352(a), or its labeling does not bear " adequate directions for use," 21 U.S.C. § 352(f)(1). Adequate directions for the use of a medical device " means directions under which the layman can use [the] device safely and for the purposes for which it is intended." 21 C.F.R. § 801.5. " Directions for use may be inadequate because, among other reasons, of omission, in whole or in part, or incorrect specification of. . . [s]tatements of all conditions, purposes, or uses for which

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such device is intended." 21 C.F.R. § 801.5(a). For purposes of the FDCA, the intended use of a medical device is determined on the basis of " the objective intent of the persons legally responsible for the labeling of [such] device[]." 21 C.F.R. § 801.4.

[Such] intent is determined by such persons' expressions or may be shown by the circumstances surrounding the distribution of the article. This objective intent may, for example, be shown by labeling claims, advertising matter, or oral or written statements by such persons or their representatives. It may be shown by the circumstances that the article is, with the knowledge of such persons or their representatives, offered and used for a purpose for which it is neither labeled nor advertised. The intended uses of an article may change after it has been introduced into interstate commerce by its manufacturer. If, for example, a packer, distributor, or seller intends an article for different uses than those intended by the person from whom he received the devices, such packer, distributor, or seller is required to supply adequate labeling in accordance with the new intended uses. But if a manufacturer knows, or has knowledge of facts that would give him notice that a device introduced into interstate commerce by him is to be used for conditions, purposes, or uses other than the ones for which he offers it, he is required to provide adequate labeling for such a device which accords with such other uses to which the article is to be put.

Id .

Criminal penalties obtain where manufacturers are found to have violated the FDCA prohibition against misbranding, see 21 U.S.C. § 333(a), as do civil penalties in the form of fines payable to the United States, see 21 U.S.C. § 333(f). However, there is no private right of action under the FDCA for a manufacturer's violation of its provisions, including the prohibition against the sale or distribution of misbranded devices. See 21 U.S.C. § 337(a); see also, e.g., Buckman, 148 L.Ed.2d at 862, n. 4.

The FDCA as modified by the MDA contains an express preemption provision as follows:

Except as provided in subsection (b) of this section, no State or political subdivision of a State may establish or continue in effect with respect to a device intended for human use any requirement--
(1) which is different from, or in addition to, any requirement applicable under this chapter to the device, and
(2) which relates to the safety or effectiveness of the device or to any other matter included in a requirement applicable to the device under this chapter.

21 U.S.C. § 360k(a).[4] The FDCA implementing regulations consistently provide, inter alia, that:

State or local requirements are preempted only when the Food and Drug Administration has established specific counterpart regulations or there are other specific requirements applicable to a particular device under the [FDCA], thereby making any existing divergent State or local requirements applicable to the device different from, or in addition to, the specific Food and Drug Administration requirements.

21 C.F.R. § 808.1(d).

A trilogy of United States Supreme Court cases provide guidance for analysis

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of preemption under Section 360k(a). The first of these was Medtronic, Inc. v. Lohr, supra, decided in 1996. The medical device at issue in Lohr was a pacemaker (a Class III device) that had not been approved by the FDA through the rigorous PMA process, but rather had avoided the premarket approval requirement by being designated as " substantially equivalent" to a pre-existing device already on the market through the less rigorous " Section 510(k) process." The Eleventh Circuit had ruled that the Lohr plaintiffs' claims of strict products liability for design defect and for negligence in design were not preempted, but that the plaintiffs' claims of negligent manufacture and negligent failure to warn were preempted. Medtronic appealed the Eleventh Circuit's decision that the claims sounding in negligence were not preempted, and the plaintiffs appealed the decision to the extent it upheld Medtronic's preemption defense.

Although all nine Lohr justices either expressly or implicitly rejected Medtronic's argument that, where the FDA imposes requirements on a medical device, all common-law causes of action arising out of an application of the device are necessarily preempted pursuant to Section 360k(a), see Lohr, 518 U.S. at 486-491, 505-508 (Breyer, J., concurring in part and concurring in the judgment), 512-513 (O'Connor, J., concurring in part and dissenting in part, joined by Rehnquist, Ch. J., Scalia, J., and Thomas, J.), only a plurality of four justices adopted Part IV of Justice Stevens' opinion, in which that argument was specifically analyzed, see id . at 486-491. Part IV expressed the plurality's opinion that " Medtronic's argument [wa]s not only unpersuasive [but also] implausible," in that any broad construction of FDCA/MDA preemption would have " the perverse effect" of largely immunizing medical device manufacturers from liability to private citizens harmed by their products, notwithstanding the express judgment of Congress that the medical device industry was in need of " more stringent regulation in order 'to provide for the safety and effectiveness of medical devices intended for human use.'" Id . at 487, quoting 90 Stat. 539. The plurality further opined in Part IV that Section 360k " simply was not intended to pre-empt most, let alone all, general common-law duties enforced by damages actions," and concluded that notwithstanding enactment of the MDA " at least some common-law claims may be maintained" against medical device manufacturers. Id . at 491. Justice Stevens and three other justices supported the plurality's opinion in Part IV in part on a reading of Congressional intent pursuant to which the statutory term " requirements" would be given a narrower construction in connection with state-law causes of action than the court had previously ascribed to the same term in the context of the preemption provision of the Public Health Cigarette Smoking Act of 1969. See id . at 487-491.

As noted above, all nine justices agreed that some or all of the Lohr plaintiffs' common-law claims against Medtronic survived FDCA/MDA preemption, and thus agreed with the ultimate conclusion reached by the plurality in Part IV. Nevertheless, Justice Breyer expressly stated that he did not join in Part IV of the court's opinion " which emphasize[d] the differences between the MDA [preemption provision] and the preemption [provision of the Public Health Cigarette Smoking Act of 1969], because those differences [we]re not. . . relevant," id . at 508 (Breyer, J., concurring in part and concurring in the judgment), and three justices joined in Justice O'Connor's partial dissent which likewise disagreed with the plurality that the statutory term " requirements"

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should be read more narrowly for FDCA/MDA preemption purposes than for purposes of Public Health Cigarette Smoking Act of 1969 preemption purposes. See id . at 510-512 (O'Connor, J., concurring in part and dissenting in part).

All nine Lohr justices agreed that the FDA does not impose " requirements" specifically regarding the design of a medical device when the device is approved through the Section 510(k) process, with the consequence that the Section 360k(a) preemption provision is entirely inapplicable to state-law design defect claims arising in connection with a device approved under Section 510(k). See id . at 492-494, 508 (Breyer, J., concurring in part and concurring in the judgment), 513 (O'Connor, J., concurring in part and dissenting in ...

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