District Court Judge Denies Manufacturer of OTC Pain Reliever Summary Judgment Based on Preemption

Judge Lawrence Stengel of the United States District Court for the Eastern District of Pennsylvania denied summary judgment to the manufacturer of an over-the-counter pain reliever. The manufacturer had sought to dismiss the plaintiff’s fraud and fraudulent misrepresentation claims as preempted by federal law.

The Food and Drug Administration (FDA) regulates how OTC drugs should be labeled and sold. The Federal Trade Commission regulates whether an OTC drugs advertising is misleading. In the case before Judge Stengel, the OTC manufacturer argued that the fraud claims were either expressly preempted pursuant to 21 U.S.C. Sec. 379r (Food, Drug, and Cosmetic Act or FDCA) or impliedly preempted under Buckman Co. v. Plaintiff’s Legal Committee, 531 U.S. 341, 121 S. Ct. 1012, 148 L. Ed. 2d 854 (2001). Judge Stengel explained that express preemption occurs when Congress indicates state law that conflicts with federal statute is trumped by the federal statute and implied preemption occurs when it is impossible for a company to comply with federal and state requirements.

The OTC defendant argued that Section 379r expressly preempts state regulations that conflict with the FDCA, which includes requirements “relating to public information or any other form of public communication relating to a warning of any kind for a drug.” 21 U.S.C. Sec. 379r(c). Section 379r(e) provides that the section does not affect any action or the liability of any person under the product liability law of any State. The FTC took the position that advertisers of OTC drugs were not limited to FDA approved labeling language. Because the fraud claims would impose more requirements on the defendants than federal law the fraud claims were in conflict with federal law, according to the defense. The court disagreed. Applying Alabama law, Judge Stengel found that fraud based claims could be considered product liability claims for purposes of preemption. Product liability claims were not expressly preempted by the FDCA but rather viable pursuant to Section 379r(e).

The court then turned to the implied preemption argument pursuant to Buckman. The court noted that the fraud claims in Buckman were based solely on disclosure requirements in the FDCA and that fraud on the FDA claims were preempted. However, Judge Stengel found that in the case before him the fraud claims centered on information provided to the consumer and physicians, rather than the FDA. Judge Stengel found those claims distinct from those that were preempted in Buckman and again noted they were based on a duty found in Alabama law regarding fraudulent misrepresentation. Thus, the fraud claims were not impliedly preempted according to Judge Stengel.

The express preemption ruling by Judge Stengel, while limited to Alabama law, may open the door to similar arguments in other States where courts have drawn parallels to Alabama product liability law. Similarly, the lack of implied preemption arguments and limitations on Buckman addressed by Judge Stengel may be used against defendants in other jurisdictions. The language and holdings of Judge Stengel should be construed to limit his rulings to cases where Alabama law controls. Judge Stengel’s opinion can be found by clicking here.

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