Tuesday, May 03, 2016
Sometimes it takes us a while to catch on to things. This is more than a little embarrassing for a Jersey guy to admit, but while many of our high school classmates were devout Springsteen fans after his first two albums, Greetings from Asbury Park and The Wild, The Innocent, and The E Street Shuffle, we would not commit until after the release of Born to Run, by which time Bruuuuuuuce had become a national phenomenon. For years we saw shaved kale salad on menus and passed it by, thinking that we probably did not like kale and definitely did not like shaving, so why bother? Now it is our go-to appetizer for when we want to feel vaguely virtuous. We were late adopters of on-line banking, Apple Pay, and Twitter. Our garage will surely be the last in the neighborhood with a hybrid powered car, a self-driving car, or a flying car. On the way back from visiting the Drug And Device Law Son in Moscow, the British Airways entertainment offerings included season 2 of Catastrophe, an Anglo-American miracle of fun and filthy television comedy. Now we are queuing up season one on Amazon Prime. We are complete-ists, even backwards, if nothing else. Better late than never, right?
Today we are taking a look at an old case (two and a half-years old, but turning up in our topic searches just now). The case is called Meredith v. Nuvasive, Inc., 2013 U.S. 190130 (W.D. Texas Dec. 9, 2013). The plaintiff in Meredith alleged injuries from malfunction of a neuromonitoring device during spinal surgery. Her claims were for manufacturing defect, breach of implied warranties, negligence, gross negligence, and res ipsa loquitur. There is nothing especially unusual in any of that. But here is the man-bites-dog aspect of the case: the product liability plaintiff moved for summary judgment against two relatively unusual defenses, the manufacturer defendant as a “health care provider” under the Texas malpractice statute, and lack of any sale of a medical device precluding warranty claims.
For those of you in need of an executive summary, know this: The plaintiff in Meredith went one for two. (1) The court held that a device manufacturer was not a health care provider under the relevant medical malpractice statute. (2) Because the device was simply used in the hospital, and not sold to the plaintiff or anyone else, the defendant had a real shot at picking off the warranty claims.
Maybe it is because doctors have a powerful lobby, or because they are so gosh-darned popular, but actions against doctors are typically subject to restrictions that other defendants wish they could enjoy. The Texas Medical Liability Act (TMLA) imposes a cap on damages, and the defendant tried to invoke that cap here. The TMLA applies to "health care liability claims" and “health care providers.” In Meredith, the defendant argued that its employee, who was in the operating room, was functioning as an independent contractor for the hospital. So this is an unusual case where the sales rep's presence in the operating room was possibly a good fact for the defense. In the alternative, the defendant argued that it was an "Affiliate" of the hospital, which would bring it within the sweet embrace of the TMLA. The court rejected both of those arguments. The manufacturer's employee had no contractual relationship with the hospital. It is not as if he had the sort of privileges that a doctor has. The hospital's willingness to provide access to the employee "subject to certain conditions does not fundamentally alter the relationship of the parties." Nor did the hospital control the manufacturer in the sense required to make it an affiliate. Thus, the court held that the defendant could not avail itself of the TMLA. (Since the Meredith case was decided, the issue has come up in other Texas cases. Bexis discussed one of those cases, and hypothesized about what it would take for a manufacturer defendant to benefit from the TMLA’s provisions, here. It is possible that Bexis was a wee bit optimistic.)
The plaintiff’s summary judgment motion against the warranty lack-of-sale defense was less successful. That is, it was unsuccessful. That is, the defendant was successful. The simple fact was that the product that allegedly malfunctioned had not been sold or leased to the hospital, surgeon, or the plaintiff. The plaintiff argued that there was Texas authority loosening up the privity requirement. Maybe so, but any such authority still involved a product that had been sold to someone, even if not the plaintiff. Not so here. The defendant's defense against the warranty claim would live to fight another day.
Of course, because the rulings in Meredith were on a summary judgment motion by a plaintiff, rather than a defendant, we do not have anything close to a definitive ruling on whether the plaintiff's claims are truly viable. But it is interesting to see what the court did with those defenses, and it is interesting (and a bit unnerving) to see a plaintiff muster the energy and creativity to file a motion for summary judgment.
Monday, May 02, 2016
In Witt v. Stryker Corp., 2016 WL 1583816 (11th Cir. Apr. 20, 2016), a Daubert decision in a Stryker knee replacement case, even ipse dixit seemed a bit generous. Roughly translated, ipse dixit means “he himself said it.” But it’s not clear that the expert in Witt said “it.” His report didn’t seem to venture an opinion at all, no less one that came from applying a scientific process to true and accurate data. It offered a feeling, seemingly a timid one hoping not to be noticed: “I feel that the mechanical failure of the EIUS [the knee replacement system] Stryker components was the competent producing cause for the need for surgery on 04/17/2009 and for a revision arthroplasty to a total knee replacement.” Id. at *5 (emphasis added). In case you thought this was just careless terminology, he did it again: “I feel that the mechanical failure of the EIUS System installed on 04/18/2008 was a competent cause for the need for subsequent surgeries on 03/30/2011 and on 01/17/2012.” Id. (emphasis added).
We haven’t studied the case law on feelings. But we are confident that, if it exists, it won’t be favorable to this expert.
Things grew more timid from there. At has deposition, it wasn’t even clear what the expert was feeling:
Indeed, he explicitly disclaimed having any expert opinion about why the EIUS design was defective. Besides broadly referencing the likelihood that the device suffered some mechanical failure, Dr. Lubliner offered no explanation for why the defect was one of design and not of manufacture.
Id. (emphasis added). Oof.
Daubert didn’t ever have to be written for us to know how the Eleventh Circuit was going to rule on this one. Finding his opinion, to say the least, undeveloped and unreliable, it upheld the trial court’s exclusion of the expert:
Plainly, his sparse report and subsequent deposition do not explain how the looseness of the device is related to the failure of its mechanical operation, nor did the expert report so much as consider any alternative explanation. Because Dr. Lubliner’s opinion regarding Witt’s EIUS device could reasonably be termed undeveloped and unreliable, the decision to exclude his testimony fell well within the district court’s exercise of discretion as a gatekeeper.
Id. Seeing no viable causation expert, the Eleventh Circuit then upheld the trial court’s grant of summary judgment to the defendant. Id. at *7
The Eleventh Circuit issued two other rulings. It upheld the trial court’s refusal to allow plaintiff to amend her complaint a third time to add a failure to warn claim based on studies published two years after the device was implanted in plaintiff. Id. at *3. We certainly understand that ruling. The Court also upheld the trial court’s decision not to further extend the discovery deadline to allow more time for expert discovery. Id. at *4. Given the expert opinion that we saw, we had a feeling that would happen too.
Friday, April 29, 2016
Can you get sued over a picture of a banana? It seems the answer might depend on where you live and probably not in Oregon. That is one takeaway from a good preemption case that came out of the District of Oregon last week, Henry v. Gerber Products Co., No. 3:15-cv-02201, 2016 U.S. Dist. LEXIS (D. Or. Apr. 18, 2016). In Henry, a concerned mother sued because the baby “Puffs” she purchased depicted a banana on the label, but contained only “natural banana flavor.” Not actual bananas. Never mind that label stated the product’s ingredients truthfully and clearly in black and white. Never mind that if a parent wants his or her toddler to snack on bananas, he or she could purchase, you know, bananas. For whatever reason, this parent preferred banana puffs, with bright yellow bananas on the label. And it resulted in a federal lawsuit.
How did we get here? Like most every other state, Oregon has an Unfair Trade Practices Act that prohibits product sellers from representing that their products have “particular characteristics, ingredients, benefits, or qualities that they do not have.” See Or. Rev. Stat. § 646.608(1)(e). A right and just law when applied properly, to be sure.
It becomes interesting, however, when talking about food because federal law is extraordinarily specific in regulating food labels. Surely you read our guest post on the FDA’s regulation of non-functional slack-fill (whatever that is) and its impact on product packaging. Or our post on food “standards of identity” which dictate what food sellers can and cannot call their products. You probably also knew that a food label’s Nutrition Facts have to appear in a certain place on the package, unless the package has less than 40 square inches of surface area, except when the packaging includes a cellophane window, which does not count as available surface area, unless the window is itself used as a label (such as with a sticker), in which case the window does count as available surface area, and provided that the manufacturer has not applied for special allowance to affix something to the packaging that might obscure the Facts, such as a straw. See 21 C.F.R. § 101.9. You get the idea—the FDA has put a lot of thought into the uniform regulation of food labels.
The tie in to drugs and medical devices is preemption. The Nutrition Labeling and Education Act gives the FDA authority to oversee food labeling, and the statute has an express preemption clause that forbids states from establishing any requirement that “is not identical to” the federal requirements in five areas of food labeling, including labeling on ingredients and flavorings. 21 U.S.C. § 343-1(a)(2) & (3). In Henry, the plaintiff alleged that the banana puff manufacturer led customers to believe that the puffs actually contained “the prominently depicted fruits,” e.g., bananas, which allegedly violated Oregon’s UTPA. 2016 U.S. Dist. Lexis 52638, at *18.
But, as it turns out, the FDA’s regulations provide that it is perfectly okay to represent a food’s flavor with a picture of a fruit, even where the food contains only “natural flavor” and not the actual fruit. The manufacturer just has to say so on the label in a mind-bogglingly particular way. (We won’t quote the regulation here; you’ll have to read the opinion to get its flavor, but trust us, its detail is exceptional.) The banana puffs manufacturer complied to a tee, which led it to argue justifiably that the plaintiff’s Oregon law claims sought to impose requirements that were “not identical to” federal requirements. Id. at **12-13.
That means federal preemption, and the district court agreed:
The gravamen of Henry’s complaint is that “[the manufacturer’s] marketing and labeling of Puffs lead consumer to believe that Puff’s actually contain the prominently depicted fruits or vegetables for which each variety is named.”
. . . .
[However, the] law, as applied to the situation presented to this Court, is clear: “FDA regulations permit illustrations of fruit on product labels to indicate that product’s ‘characterizing flavor,’ even where the product contains no ingredients derived from the depicted fruit.” [¶] Henry’s state law claims under the UTPA are, therefore preempted.
Id. at **18-19 (citations omitted). This is a pretty straightforward application of express preemption, but there are two points that we think make this order particularly interesting.
First, in its discussion of preemption law, the district court invoked the “presumption against preemption,” under which it would “start with the assumption that the historic police powers of the State were not to be superseded by [federal law] unless that was the clear and manifest purpose of Congress.” Id. at *13 (citing Medtronic v. Lohr, 518 U.S. 470 (1996)). Don’t get Bexis started on the presumption against preemption. (See, for example, here) The presumption (or assumption) is a false concept, a makeweight invoked when consistent with a no-preemption result. In Henry, the express preemption was so clear that the “presumption” did not matter. The district court found preemption regardless.
Second, the district court distinguished the case from another from its neighbor to the south, the Golden State. You see, the Nutrition Labeling and Education Act has a catch-all, which prohibits food labeling that is “false or misleading in any particular.” 21 U.S.C. § 343(a). Because the preemption provision does not expressly cover the catch-all, the plaintiff argued that any claim under the catch-all was not preempted, citing an order from the Central District of California, Zupnik v. Tropicana Products Inc., No. 09-cv-6130 (C.D. Cal. Feb. 1, 2010).
The district court rejected this argument as overly simplistic. Just because a label allegedly falls within a catch-all for “false or misleading” labeling does not mean that it all of a sudden falls outside the FDA’s more specific regulations, which permit exactly that labeling. As the district court put it, “[W]here the challenged conduct is expressly required or permitted by FDA regulations, the claims fall within the core of the preemption provision because they would ‘impose different requirements on precisely those aspects . . . that the FDA had approved.’” Id. at *20 (citations omitted). Moreover, where the FDA regulations permit particular labeling, that labeling is not considered “false or misleading” under federal law by definition. Id. According to the Henry judge, the Zupnik order from California was an outlier and “quite perfunctory” in an area of the law that was complex and nuanced. As Californians, we say “ouch.” But setting our native pride aside, we have to say that we agree.
Food litigation may continue in California, but manufacturers should continue to push back with preemption and its lesser sibling, primary jurisdiction. Preemption carried the day in Oregon, and it should continue to do so.
Thursday, April 28, 2016
We talk a lot about PMA preemption on this blog. And why shouldn’t we. It’s probably been the most consistent source of defense wins in the last five plus years. The body of preemption law that has grown out of Riegel v. Medtronic, Inc. is something we’ve watched with admiration. Likewise, we’ve watched plaintiffs’ counsel try to thwart, dodge, and squeeze by or around PMA preemption for just as long. Plaintiffs have met with occasional limited success, which while not our favorite topic, doesn’t usually give us significant pause because even if a claim or two sneaks by – preemption usually guts most of plaintiffs’ causes of action. But then every so often, we get the complete win. Total victory, dismissal with prejudice. And as routine as a PMA preemption win might be – the complete win is still something blog-worthy.
That brings us to today’s case – Yosowitz v. Covidien, Civil Action No. H-15-2902 (S.D. Tex. Apr. 25, 2016). Plaintiff underwent a surgical procedure to repair intracranial aneurysms during which defendant’s embolization device was implanted. Plaintiff alleges that a defect in the device caused her to suffer a blocked blood vessel which led to mini-strokes and resultant injuries. Yosowitz, slip op. at 1-2. The device was a Class III, Pre-Market Approved device. So, the court’s first stop in its decision was a fairly thorough of PMA preemption law. Id. at 7-13. Following that discussion, you’ll see this section heading: Plaintiffs’ Claims are All Preempted or Fail to Properly Allege a Claim which was followed by Plaintiffs Have Not Pleaded Any Parallel Claim. Id. at 13. Pretty much guaranteed we were going to like the rest of the opinion.
Applying all that preemption law to the claims in Yosowitz, the court started with the state law claims for negligence, strict liability, breach of express warranty and breach of implied warranty. Since all four impose requirements on medical devices, they must not be different from or in addition to the requirements imposed by the FDCA. Id. at 16-17. To establish that, plaintiff’s allegations must identify the “specific PMA requirements that have been violated.” Id. at 14. “[S]cattered allegations of federal law violations” do not suffice. Id. at 13.
The court summed up plaintiff’s negligence claims as failure to manufacture, market and label a product that was (1) safe and/or (2) consistent with the original design and/or (3) consistent with FDA regulations. Id. at 18. As to point 1, the device received FDA PMA approval – any state law that required defendant to manufacture or label its device in a way other than the way the FDA approved it, is preempted. Id. at 18. Plaintiff tried to argue that points 2 and 3 were parallel claims, but the court found the unsupported allegations failed to provide any information on how the device’s design differed or was inconsistent with federal regulations. Id. at 21. All the negligence claims were dismissed.
Plaintiff’s strict liability claim did not contain any allegations that defendant failed to comply with any federal regulations – therefore, any requirement plaintiff sought to impose on defendant would be different from or in addition to federal regulations. Id. at 22. All the strict liability claims were dismissed.
With breach of express warranty, there again is no allegation of a violation of any federal regulation. So, any finding of breach of warranty would necessarily involve a decision by a jury that the device was “unsafe and ineffective.” Id. at 24. “The FDA determined otherwise through the PMA process, so the state claim is based on different or additional requirements and is expressly preempted.” Id. Moreover, plaintiff’s complaint failed to allege the actual representations constituting the express warranty or when and how the plaintiff received notice of them. Id. at 24-25. Finally, if the alleged representations were made in the label, warnings or instructions for use – they were FDA approved. Another basis for express preemption. Id. at 25.
Plaintiff’s breach of implied warranty claim suffered from the same problems, because plaintiff only alleged that she “believes” there was a violation that was a cause of her injuries. Id. at 26. Belief may be strong enough for Santa Claus and the Tooth Fairy, but it’s not enough to satisfy federal pleadings standards. All the breach of warranty claims were dismissed.
With the traditional state law claims disposed of, plaintiff’s remaining claim was for failure to comply with the FDCA and its implementing regulations. Had plaintiffs never heard of Buckman? Is this anything other than a private cause of action to enforce FDCA regulations? This claim is impliedly preempted. Id. at 27-28. Even if it weren’t preempted, it doesn’t contain any allegations of how defendant failed to comply the regulations nor any allegations of a causal connection between failure and the plaintiff’s injuries. Id. at 28.
Wednesday, April 27, 2016
The plaintiff in Frere v. Medtronic, Inc., 2016 WL 1533524 (C.D. Cal. April 6, 2014), was an 80 year-old woman who had an infusion pump implanted to treat her chronic low-back pain. According to the plaintiff, the device never delivered the pain relief she had experienced during her pre-implantation pump trial, and she ultimately suffered complications. The device is a Class III medical device, requiring FDA premarket approval. Product liability litigation involving Class III devices does not get very far without bumping into federal preemption issues. Frere is no exception.
The problem with the plaintiff’s complaint was that it was either unclear or clearly preempted. The strict liability claims failed because they consisted of conclusory allegations that the purported defects or failure to warn caused her injuries. For example, in the manufacturing defect claim, the plaintiff alleged: (1) that “the catheters at issue were occluded, fractured, obstructed, and/or malfunctioning, which caused Plaintiff to suffer severe injuries and which required multiple surgeries and medical procedures to correct these defects”; and, (2) “as a direct result of the defects, Plaintiff suffered crippling injuries which left Plaintiff with permanent and significant disabilities compensable under the law.” There is no there there. Similarly, in connection with her failure to warn claim, the plaintiff alleged that “[a] foreseeable, direct and proximate result of [Defendants’] failure to warn Plaintiff, Plaintiff’s medical providers, and the FDA . . . about the defective condition of the [Device], Plaintiff suffered crippling injuries that left Plaintiff with permanent and significant disabilities.” The court refused to accept those mere “labels and conclusions.” The complaint was bereft of any facts as to how the alleged manufacturing defect and failure to warn caused her injuries. All we get is the conclusion of causation itself.
That’s before we even get to preemption. The claims run afoul of either implied, Buckman preemption by asking the court to second-guess the FDA, or run afoul of express Medical Device Amendment preemption by asking the court to impose a requirement different from or in addition to federal law. The plaintiff argued that “[t]he sum and substance of [her] claim is that the product in question was manufactured at a time when Defendants were in violation of federal regulations dealing with manufacturing processes.” That argument walks into Buckman and does not identify “specific federal requirements” that parallel California law. The plaintiff also alleged that the defendants “failed to inform or otherwise warn the FDA, medical providers, and consumers such as Plaintiff of the high failure rates” of “the catheters at issue.” But federal regulations required the defendants to report adverse events to the FDA, not to doctors, so the claim sought to impose additional requirements.
Other claims fared no better. The court was just as exacting with respect to the inevitable warranty claims as with the defect and warning claims. The plaintiff failed to plead facts that plausibly indicated that the defendants breached a warranty made beyond any statements approved by the FDA during the premarket approval process. The plaintiff alluded to “articles in medical journals, advertising and/or other documents and/or promotional materials,” but offered no reason to infer that such statements became “part of the basis of the bargain” sufficient to state a claim for breach of express warranty. Moreover, in basing an implied warranty claim solely on conduct allegedly violating the FDCA, the plaintiff once again walked off the Buckman cliff.
The fraud/misrepresentation claims walked off that same cliff, because the allegedly offending marketing materials had all been reviewed by the FDA as part of the PMA process. The plaintiff never suggested that the statements exceeded the scope of any statements approved by the FDA. Moreover, and predictably, the fraud claims flunked the Rule 9 particularity requirement. The complaint did not allege the when and where of the misrepresentations, to whom they were made, and how they were false.
The complaint also included an allegation that the defendants had failed to train the plaintiff’s medical providers regarding how to install the device. The court held that such a claim can survive “only to the extent the manufacturer failed to provide the training required by the premarket approval process.” Here, the plaintiff did not allege any facts regarding how the defendants’ training procedure deviated from the training procedure approved by the FDA in the premarket approval process. Nor did the plaintiff assert any causal connection between the potential training deviations and her injuries. Those failures derailed the training claim.
Finally, the court dismissed the plaintiff’s claim under California’s Unfair Competition Law. That claim sounded in fraud and was therefore subject to the same particularity pleading requirement that knocked out the fraud claims. Again, the complaint failed to state how the alleged misrepresentations “immediatel[ly]” caused the plaintiff’s injuries.
These rulings resulted in a dismissal of the entire Frere complaint. But the court saw a possibility that the plaintiff could reallege her claims “to evade preemption,” so dismissal was with leave to amend. In all likelihood, we will report again on this case in the not-too-distant future.
Tuesday, April 26, 2016
For years we’ve advocated about ediscovery for defendants – consisting mostly of material gathered from a plaintiff’s social media postings. OK, so let’s assume some degree of success. Defense-side ediscovery has generated some good stuff, and come trial, we want to get it admitted into evidence. Now what?
That’s the subject of today’s rather short post. Since we’re hardly the source of all useful information, we’d like to pass along a handy 4-page checklist for the admissibility of electronic evidence. It covers evidence in the form of: e-mail, internet website posts; text messages/tweets; computer stored information; animations and simulations; and digital photos. It has the following headings:
1. Preliminary Rulings on Admissibility
2. Is the Evidence Relevant?
3. If Relevant, Is It Authentic?
4. Is Evidence Hearsay?
5 Original Writing Rule
6 Practice Tips
It’s what it purports to be – a checklist – it doesn’t provide case law, but it’s the kind of thing that lends itself to use in trial, rather than pretrial, situations.
Monday, April 25, 2016
As we’ve discussed previously, and as the legal profession is by now well aware, the discovery provisions of the Federal Rules of Civil Procedure were significantly amended effective December 1, 2015. One of the foundational changes was to Rule 26(b)(1), and was intended to reduce the scope of discovery generally. The old excuse for ridiculous over-discovery – “reasonably calculated to lead to the discovery of admissible evidence” – is no more. The new, more restrictive, language defining the scope of discovery is “any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case.” Fed. R. Civ. P. 26(b)(1). As the committee notes to this amendment explain, the old language was frequently misunderstood to permit discovery into material that was itself irrelevant to litigation:
The former provision for discovery of relevant but inadmissible information that appears “reasonably calculated to lead to the discovery of admissible evidence” is also deleted. The phrase has been used by some, incorrectly, to define the scope of discovery. As the Committee Note to the 2000 amendments observed, use of the “reasonably calculated” phrase to define the scope of discovery “might swallow any other limitation on the scope of discovery.” The 2000 amendments sought to prevent such misuse by adding the word “Relevant” at the beginning of the sentence, making clear that “‘relevant’ means within the scope of discovery as defined in this subdivision ...” The “reasonably calculated” phrase has continued to create problems, however, and is removed by these amendments. It is replaced by the direct statement that “Information within this scope of discovery need not be admissible in evidence to be discoverable.”
Committee Note to Rule 26, 2015 US Order 0017 (April 29, 2015).
That’s all well and good, but since amended Rule 26 became effective, it has become evident that some courts continue to do the same thing they’ve always done, giving lip service to the new rule, but effectively applying the old standard. One recent example is Hodges v. Pfizer, Inc., 2016 WL 1222229 (D. Minn. March 28, 2016) – yet another Stevens-Johnsons Syndrome case, this time against Advil − in which the plaintiff sought, and obtained, excessive discovery concerning: (1) dealings with foreign regulators (“seven countries and three areas,” id. at *3) who do not follow the same standards as the FDA; (2) “financial documents” concerning Advil, including “profits (gross and net) . . . sales forecasts, advertising budgets, business plans, marketing plans, and financial plans” for a ten-year period, id. at *4; and (3) old “sales and marketing documents . . . from before June 2005, when the FDA required manufacturers to include new warnings about” this condition. Id. at *4. While the opinion doesn’t mention the date of injury, we thought it might be 2010 (five years after the label change) and since we have a PACER account and know how to use it, we were able to confirm that date as correct.
All three requests were granted despite their obvious remoteness from a U.S. case involving a single injury in 2010. Indeed, in 2010, any Advil made in 2005 would have long since been expired. While the new rule was cited, it was construed solely by reference to pre-amendments cases – in particular, one holding that “relevance” in Rule 26 “is to be construed broadly and encompasses ‘any matter that bears on, or that reasonably could lead to other matter that could bear on, any issue that is or may be in the case.’” Id. at *2 (quoting a 1997 D. Minn. case that in turn quotes Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 351 (1978)).
That’s where at least part of the problem lies. Oppenheimer is obsolete – overtaken by at least two sets of rules amendments. The case is almost 40 years old. To use it to perpetuate the same broad view of discovery scope that the 2015 “claims or defenses” amendment to Rule 26 expressly rejected is unsupportable. We discussed the intent of the 2015 amendments at length here, relying upon Chief Justice Roberts’ contemporaneous report concerning them.
So, what went down in Oppenheimer? Oppenheimer was a securities class action. Through discovery, the plaintiff demanded that the defendant essentially do plaintiff’s work for him – to provide the information that would identify who was, and was not, a member of the putative class. Id. at 350. The Court was asked to determine whether identification of class members war properly addressed by discovery, or alternatively under Fed. R. Civ. P. 23. The Court held that Rule 23 controlled:
Rule 23 . . . deals comprehensively with class actions, and thus is the natural place to look for authority for orders regulating the sending of notice. It is clear that Rule 23(d) vests power in the district court to order one of the parties to perform the tasks necessary to send notice. . . . Since identification simply is another task that must be performed in order to send notice, we agree . . . that Rule 23(d) also authorizes a district court in appropriate circumstances to require a defendant’s cooperation in identifying the class members to whom notice must be sent.
Id. at 354-55 (footnotes omitted). What about the discovery rules? “[W]e do not think that the discovery rules are the right tool for this job.” Id. at 354.
What that tells us is that what the Court had to say about the discovery rules generally – as they stood in 1978 – is entirely dictum. Oppenheimer did not make any precedential ruling about discovery, or about Rule 26. To the contrary, it held that that discovery rules were inapplicable.
Beyond that, the dictum in Oppenheimer is facially inapplicable to the new language of Rule 26. The Court stated:
The key phrase in this definition − “relevant to the subject matter involved in the pending action” − has been construed broadly to encompass any matter that bears on, or that reasonably could lead to other matter that could bear on, any issue that is or may be in the case.
Id. at 315 (citing Hickman v. Taylor, 329 U.S. 495, 501 (1947) – a case about work-product protection) (emphasis added). That “key phrase” no longer exists. The phrase was precisely what the 2015 amendments got rid of, and the committee that drafted those amendments did so equally precisely (as quoted above – and there are more quotes to the same effect) to reduce the scope of discovery.
The phrase that Oppenheimer described in 1978 is simply no longer the test of discoverability. Rather, “[p]roportional discovery relevant to any party’s claim or defense suffices, given a proper understanding of what is relevant to a claim or defense” is. Committee Note to Rule 26, 2015 US Order 0017 (April 29, 2015). Nor would Oppenheimer even support discovery into old labeling used long before an accident. “[I]t is proper to deny discovery of matter that is relevant only. . . to events that occurred before an applicable limitations period, unless the information sought is otherwise relevant to issues in the case.” 437 U.S. at 352.
Unfortunately, Hodges is not alone in erroneously relying on the Oppenheimer’s obsolete observation as if it were somehow applicable to the “claims or defenses” scope-of-discovery standard in current Rule 26(b)(1). The “key element” language is found in headnote six of Oppenheimer. According to Westlaw, Oppenheimer has been cited in 73 cases since December 1, 2015. Of those 73 cases, obsolete headnote six has been cited in 53 of them. Plainly, a concerted effort is underway to misquote Oppenheimer – leaving out that the “key element” is precisely the language amended out of the rule – in order to gut the 2015 amendment.
A few examples should suffice. The most recent case of the lot, Rhone v. Schneider National Carriers, Inc., 2016 WL 1594453 (E.D. Mo. April 21, 2016), granted a motion to compel while citing the Oppenheimer language – conveniently omitting the “key phrase” part and beginning its quotation with “broadly construed.” Id. at *1. In Lightsquared Inc. v. Deere & Co., 2015 WL 8675377 (S.D.N.Y. Dec. 10, 2015), although conceding that “discovery no longer extends to anything related to the ‘subject matter’ of the litigation,” the opinion nevertheless cited to Oppenheimer to hold that “relevance is still to be ‘construed broadly to encompass any matter that bears on, or that reasonably could lead to other matter that could bear on’ any party’s claim or defense.” Id. at *2. United States ex rel. Shamesh v. CA, Inc., 2016 WL 74394 (D.D.C. 2016), is even worse – using the obsolete Oppenheimer dictum to evade the 2015 amendments altogether: “Like before, relevance is still to be ‘construed broadly to encompass any matter that bears on, or that reasonably could lead to other matter that could bear on’ any party's claim or defense.” Id. at *7 (quoting Oppenheimer).
These decisions are simply erroneous. Oppenheimer expressly construed language deleted by the 2015 amendments because it was being used to allow excessively broad discovery. To the extent Oppenheimer is relevant to anything anymore, we recommend its holding that plaintiffs – the requesting party − be required to pay for discovery that they sought of electronically stored information:
Both opinions [below] suggest that the fact that part of these records are kept on computer tapes justifies imposing a greater burden on [defendants] than might be imposed on a party whose records are kept in another form. . . .
* * * *
We do not think these reasons justify the order in this case. There is no indication or contention that these petitioners have acted in bad faith to conceal information from respondents. In addition, although it may be expensive to retrieve information stored in computers when no program yet exists for the particular job, there is no reason to think that the same information could be extracted any less expensively if the records were kept in less modern forms. Indeed, one might expect the reverse to be true, for otherwise computers would not have gained such widespread use in the storing and handling of information. Finally, the suggestion that petitioners should have used “different systems” to keep their records borders on the frivolous. . . . [W]e do not think a defendant should be penalized for not maintaining his records in the form most convenient to some potential future litigants whose identity and perceived needs could not have been anticipated.
437 U.S. at 362-63
In short, it is disingenuous in the extreme for those pursuing discovery to justify their overreaching demands with obsolete dictum from Oppenheimer. To do so only undermines the years of efforts that went into the reform of discovery represented by 2015 Amendments.