Kaiser v. Johnson & Johnson, 18-2944

• Decision Date: 14 January 2020
• Docket Number: No. 18-2944,18-2944
• Citation: 947 F.3d 996
• Parties: Barbara KAISER, Plaintiff-Appellee, v. JOHNSON & JOHNSON and Ethicon, Inc., Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

947 F.3d 996

Barbara KAISER, Plaintiff-Appellee,

v.JOHNSON & JOHNSON and Ethicon, Inc., Defendants-Appellants.

No. 18-2944

United States Court of Appeals, Seventh Circuit.

Argued May 21, 2019

Decided January 14, 2020

Timothy Jackson, Attorney, Edward A. Wallace, Attorney, Mark R. Miller, Attorney, Wexler Wallace LLP, Chicago, IL, Jeffrey Kuntz, Attorney, Wagstaff & Cartmell LLP, Kansas City, MO, Thomas O. Plouff, Attorney, Costello, McMahon, Burke & Murphy LTD., Chicago, IL, for Plaintiff-Appellee.

Timothy Jackson, Attorney, Edward A. Wallace, Attorney, Mark R. Miller, Attorney, Wexler Wallace LLP, Chicago, IL, Jeffrey Kuntz, Attorney, Wagstaff & Cartmell LLP, Kansas City, MO, Thomas O. Plouff, Attorney, Costello, McMahon, Burke & Murphy LTD., Chicago, IL, for Plaintiff.

Lisa Schiavo Blatt, Attorney, Katherine Moran Meeks, Attorney, Williams & Connolly LLP, Washington, DC, Stephen D. Brody, Attorney, David Kendall Roberts, Attorney, Jason Zarrow, Attorney, O'Melveny & Myers LLP, Washington, DC, R. Stanton Jones, Attorney, Stephen K. Wirth, Attorney, Samuel Callahan, Attorney, William Perdue, Attorney, Arnold & Porter Kaye Scholer LLP, Washington, DC, Amy M. Pepke, Attorney, Butler Snow LLP, Memphis, TN, Mary Nold Larimore, Attorney, Ice Miller LLP, Indianapolis, IN, for Defendants-Appellants.

Before Flaum, Kanne, and Sykes, Circuit Judges.

Sykes, Circuit Judge.

Barbara Kaiser had surgery to implant the Prolift Anterior Pelvic Floor Repair

System, a transvaginal mesh medical device that supports the pelvic muscles. Within a few years of her surgery, Kaiser began experiencing severe pelvic pain, bladder spasms, and pain during intercourse. Her physician attributed these conditions to contractions in the mesh of the Prolift. Kaiser had revision surgery to remove the device, but her surgeon could not completely extract it. He informed her that the painful complications she was experiencing were likely permanent.

Kaiser sued Ethicon, Inc., Prolift’s manufacturer, and Johnson & Johnson, its parent company, seeking damages under the Indiana Products Liability Act, IND. CODE §§ 34-20-1-1 to 34-20-9-1. (Johnson & Johnson has no distinct role in this litigation, so we refer to the defendants collectively as "Ethicon.") After a two-week trial, a jury found Ethicon liable for defectively designing the Prolift device and failing to adequately warn about its complications. The jury awarded a hefty sum: $10 million in compensatory damages and $25 million in punitive damages, though the judge granted Ethicon’s motion for remittitur and reduced the punitive award to $10 million.

Ethicon’s appeal is a broad-spectrum attack on the judgment, starting with an argument about federal preemption and moving through several issues of Indiana product-liability law, a claimed evidentiary error, and challenges to the compensatory and punitive damages. We reject these arguments and affirm.

One issue in particular warrants special mention upfront. Our caselaw interprets the Indiana Product Liability Act to require a plaintiff in a design-defect case to produce evidence of a reasonable alternative design for the product. The Indiana Supreme Court disagrees. See TRW Vehicle Safety Sys., Inc. v. Moore , 936 N.E.2d 201, 209 (Ind. 2010). The state supreme court’s decision controls on a matter of state law, so we apply TRW rather than our own contrary precedent.

I. Background

A. Prolift

Barbara Kaiser suffers from pelvic-organ prolapse, a nonlife-threatening condition that occurs when pelvic muscles loosen, causing nearby organs to press into the vagina. This condition can lead to several medical complications like uncomfortable pelvic pressure and incontinence.

Ethicon developed Prolift as a treatment option for patients with this condition, and in 2009 Kaiser had surgery to implant the device. Some detail about Prolift is necessary to understand her case and the arguments raised on appeal. The device is essentially a precut section of polypropylene mesh connected to six mesh arms. A surgeon inserts it through the vagina, pulls it through the vaginal wall, and anchors the arms to muscles in the hip, thigh, and groin. The device was designed to reinforce the pelvic muscles and prevent further organ displacement.

Ethicon began marketing Prolift in 2005. It included an "Instructions for Use" package insert that warned: "Potential adverse reactions are those typically associated with surgically implantable materials, including infection potentiation, inflammation, adhesion formation, fistula

formation, erosion, extrusion and scarring that results in implant contraction." It also cautioned that "[t]ransient leg pain may occur and can usually be managed with mild analgesics."

Patients soon reported serious problems with the Prolift. Relevant here, the mesh would often contract, causing severe pain and bladder problems. Scar tissue could also form around the device, preventing a complete removal if complications occurred. In these cases Prolift’s complications frequently became permanent. Following years of complaints and FDA scrutiny, Ethicon took Prolift off the market in 2012.

B. Regulatory Background

The FDA cleared Prolift for sale in 2007. The clearance process features prominently in this appeal, so we take a moment to describe the FDA’s role in regulating medical devices. The Medical Device Amendments of 1976 ("MDA"), 21 U.S.C. §§ 360c – 360k, 379 – 379a, establishes the framework for federal regulation of medical devices. As amended, the MDA requires the FDA to place a device into one of three classes reflecting different levels of regulation.

Class I covers devices for which the MDA’s "general controls" that apply to all medical devices "are sufficient to provide reasonable assurance of the safety and effectiveness of the device." 21 U.S.C. § 360c(a)(1)(A)(i). These general controls include measures like the MDA’s prohibition on misbranding a device. The FDA typically places low risk devices like bandages and tongue depressors

in Class I.

The FDA places a device in Class II when the MDA’s "general controls by themselves are insufficient to provide reasonable assurance of ... safety and effectiveness" but enough information exists "to establish special controls to provide such assurance." Id. § 360c(a)(1)(B). "Special controls" are regulations tailored to the device such as performance standards and postmarket surveillance. See id. Most medical devices fall into Class II.

Finally, a Class III device is one for which "insufficient information exists to determine" that either general or special controls "would provide reasonable assurance of ... safety and effectiveness." Id. § 360c(a)(1)(C)(i). These devices "present[ ] a potential unreasonable risk of illness or injury" or are "purported or represented to be for a use in supporting or sustaining human life or for a use which is of substantial importance in preventing impairment of human health." Id. § 360c(a)(1)(C)(ii). Before marketing, a Class III device undergoes "a rigorous regime of premarket approval." Riegel v. Medtronic, Inc. , 552 U.S. 312, 317, 128 S.Ct. 999, 169 L.Ed.2d 892 (2008).

The particulars of the premarket approval process aren’t important here; it’s enough to note that it requires extensive submissions by the device manufacturer and a thorough review by the FDA. See generally 21 U.S.C. §§ 360c, 360e. The FDA has broad discretion to withhold approval throughout the process. See 21 C.F.R. § 861.1(b) (permitting the FDA to set performance standards for Class II and III devices); see also Nicholas R. Parrillo, Federal Agency Guidance and the Power to Bind: An Empirical Study of Agencies and Industries , 36 YALE J. ON REG . 165, 186–87 (2019).

The MDA automatically places a new medical device in Class III. 21 U.S.C. § 360c(f)(1). But three broad exceptions largely overshadow this rule. To start, medical devices on the market before the MDA’s enactment in 1976 are subject only to the MDA’s general controls until the FDA promulgates device-specific regulations to classify and regulate them. Id. § 360e(b).

Post-1976 devices can escape rigorous premarket review through the MDA’s "premarket notification" process. Almost every manufacturer of a new device must submit a notification to the FDA at least 90 days before marketing the device. See 21 C.F.R. § 807.81(a) ; see also id. § 807.81(a)(3) (requiring a manufacturer to file a premarket notification when it alters an existing device if the alteration "could significantly affect the safety or effectiveness of the device" or if it creates a "major change or modification in the intended use of the device"). The FDA may clear a device for sale without premarket approval based on this notification if it is satisfied the device falls into one of the two other exceptions.

First, the MDA exempts from premarket review any device that receives what’s known as a "§ 510(k) clearance" from the FDA. To get this clearance, a device must be "substantially equivalent" to either a pre-1976 device that the FDA hasn’t yet classified or a Class I or II device already on the market. § 360c(f)(1). Most medical devices enter the market through this exception. See 2 JAMES T. O’REILLY & KATHARINE A. VAN TASSEL, FOOD AND DRUG ADMINISTRATION § 18.22, at 464 (4th ed. 2019).

Second, if a device isn’t substantially equivalent to an unclassified pre-1976 device or a Class I or II device, it can still avoid premarket review through "de novo" § 510(k) clearance. See 21 U.S.C. § 360c(f)(2)(A). Specifically, a manufacturer may petition the FDA that a device meets the criteria for Class I or II. If the FDA agrees, the device is exempted from premarket review. Id. ; O’REILLY & VAN TASSEL , supra , § 18.26, at 470–71.

The § 510(k) clearance process is central to several issues raised in this appeal. If the FDA is satisfied that a new device is substantially equivalent to a device that is already in Class I or II or meets the standards for these classes through "de novo" § 510(k) review,...