Novartis Successfully Defeats Punitive Damages Claim in Aredia/Zometa Litigation
July 10, 2014
The U.S. District Court for the Southern District of Ohio held that federal law preempted punitive damages under both Ohio and New Jersey law in Monroe v. Novartis Pharm. Corp.
Plaintiffs in Monroe filed their complaint in the District of Columbia, and the case was subsequently transferred to the Southern District of Ohio. The court thus applied District of Columbia choice-of-law rules, requiring the court to first determine potentially interested states and whether their respective laws conflict. Order at 24-25. The court found New Jersey and Ohio had a potential interest in the controversy at hand, but no conflict of laws existed because neither state permitted recovery of punitive damages in the circumstances presented. Id. at 25.
The court noted that Ohio Revised Code § 307.80(C)(1)(a) precludes punitive damages when the alleged drug “was manufactured and labeled in relevant and material respects in accordance with the terms of an approval or license issued by the federal food and drug administration under the ‘Federal Food, Drug, and Cosmetic Act.’” Order at 25. An exception exists if the plaintiff can show by a preponderance of the evidence “that the manufacturer fraudulently and in violation of applicable regulations of the food and drug administration withheld from the food and drug administration information known to be material and relevant to the harm that the claimant allegedly suffered or misrepresented to the food and drug administration information of that type.” Ohio Rev. Code Ann. § 2307.80 (West).
The court found that this fraud-on-the-FDA exception has been abrogated by the United States Supreme Court. Order at 25 (citing Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341, 348 (2001) (“the plaintiffs’ state law fraud-on-the-FDA claims conflict with, and are therefore impliedly pre-empted by federal law.”). The court also held that Sixth Circuit law further abrogated Ohio’s statutory fraud-on-the-FDA exception. Id. at 25-26 (citing; Garcia v. Wyeth-Ayerst Labs., 385 F.3d 961, 966 (6th Cir. 2004); Marsh v. Genentech, Inc., 693 F.3d 546, 551 (6th Cir. 2012)). The court then noted that the Northern District of Ohio held that “a punitive-damages claim for an FDA-approved drug is allowed under Ohio law only if the FDA has made a finding of either fraud or misrepresentation.” Id. at 26 (citing In re Gadolinium-Based Contrast Agents Products Liab. Litig., MDL No. 1909, 2013 WL 587655, at *14 (N.D. Ohio Feb. 13, 2013)). The court held that “because there has been no finding of fraud by the FDA here, no punitive damages claim is permissible.” Id.
The court also held that New Jersey law bars punitive damages. Id. (citing Rowe v. Hoffman-La Roche, Inc., 917 A.2d 767, 774 (N.J. 2007)). The court found that plaintiffs failed to contest, and therefore conceded, this point. The court thus held no conflict of law analysis was required because punitive damages are unavailable under both Ohio and New Jersey law and “federal law preempts any punitive damages claims in this case.” Order at 27.