United States: Reflections On Albrecht – What Preemption Being A "Legal Question" Might Mean

Last Updated: June 6 2019
Article by James Beck

As we discussed in our " breaking news" post, the Supreme Court's decision in Merck Sharp & Dohme Corp. v. Albrecht, ___ S. Ct. ___, 2019 WL 2166393 (U.S. May 20, 2019) ("Albrecht"), delivered a defense win on the main issue before the Court – that preemption is a question "a question of law, normally for a judge to decide without a jury." Id. at *9. All nine justices agreed that preemption is a question of law. "We here decide that a judge, not a jury, must decide the pre-emption question." Id. at *6.

[T]he question is a legal one for the judge, not a jury. The question often involves the use of legal skills to determine whether agency disapproval fits facts that are not in dispute. Moreover, judges, rather than lay juries, are better equipped to evaluate the nature and scope of an agency's determination. . . . And judges are better suited than are juries to understand and to interpret agency decisions in light of the governing statutory and regulatory context. To understand the question as a legal question for judges makes sense given the fact that judges are normally familiar with principles of administrative law. Doing so should produce greater uniformity among courts; and greater uniformity is normally a virtue when a question requires a determination concerning the scope and effect of federal agency action.

Id., at *9. (citations and quotation marks omitted). See also Id. at *12 ("I agree with the Court's decision on the only question that it actually decides, namely, that whether federal law allowed [defendant] to include in the [drug] label the warning alleged to be required by state law is a question of law to be decided by the courts, not a question of fact.").

In holding preemption a question of law, the Albrecht Court looked to the resolution of subsidiary factual issues in patent law, relying on Markman v. Westview Instruments, Inc., 517 U.S. 370 (1996). Markman likewise evaluated the relative competence of judges and juries (after finding originalism unavailing in the patent arena due to lack of available 18th Century case law), and similarly held that complex and technical issues are best decided by trained jurists rather than lay jurors:

[W]hen an issue falls somewhere between a pristine legal standard and a simple historical fact, the fact/law distinction at times has turned on a determination that, as a matter of the sound administration of justice, one judicial actor is better positioned than another to decide the issue in question." So it turns out here, for judges, not juries, are the better suited to find the acquired meaning of patent terms.

Id. at 388 (citation and quotation marks omitted). "[C]redibility" findings – the jury's "forte" – were typically "subsumed within the necessarily sophisticated analysis of the whole." Id. at 389. "The decisionmaker vested with the task of construing the patent" – that is to say, the judge – "is in the better position to ascertain whether an expert's proposed definition fully comports with the specification and claims and so will preserve the patent's internal coherence." Id. at 390. Further, "[u]niformity would, however, be ill served by submitting issues of [patent] construction to juries." Id. at 391. As Albrecht observed, uniformity is also a "virtue" preserved by preemption. 2019 WL 2166393, at *9. Accord, e.g., Geier v. American Honda Motor Co., 529 U.S. 861, 871 (2000). Markman provides strong support for defense arguments that factual questions arising in the context of preemption motions are to be decided by judges.

What are the implications of Albrecht's unanimous ruling? First, the Court's rationale does not appear to be limited to any particular form of preemption. Heck, we see no reason why Albrecht shouldn't apply to other preemption regimes such as aviation. But in our sandbox, if factual disputes involving, say, compliance with the FDCA, encountered in the context of implied preemption are to be resolved by judges, the same would logically be true of factual disputes encountered in the context of express preemption. We note that even the Third Circuit admitted as much. See In re Fosamax (Alendronate Sodium) Products Liability Litigation, 852 F.3d 268, 288 (3d Cir. 2017) ("most preemption cases present purely legal questions - for example, . . . how to interpret the scope of an express preemption provision"), rev'd on other grounds, 2019 WL 2166393 (U.S. May 20, 2019).

For instance, the logic of Albrecht is that, not only should courts decide whether a viable "parallel" claim exists in a PMA medical device case, but they also should resolve the merits of such purported exceptions to preemption. Instead of juries hearing dueling testimony of plaintiff and defense FDA experts on whether some arcane CGMP was violated in some possibly causal fashion, judges should decide such issues, since the Albrecht Court has unanimously concluded that judges are "better equipped to evaluate" the intricacies of the FDA's regulatory scheme. Purported FDA experts like Kessler and Parisian regularly violate the limitation that expert witness should not offer conclusions of law, so confining them to testifying to judges rather than juries is more in keeping with the proper roles of expert witnesses generally.

In this respect, therefore, Albrecht should be of great interest to medical device manufacturers and other defendants litigating express preemption cases. If preemption, qua preemption, is a question of law, then as in implied preemption cases, judges will no longer be able to hold that "issues of fact" relating to preemption exist as sufficient to deny preemption motions. Thus, defendants should carefully consider whether a lot of adverse PMA preemption precedent actually applies any longer, given that "a judge, not a jury" must resolve all preemption related factual disputes.

For instance, the Blog has bashed Bausch v. Stryker Corp., 630 F.3d 546 (7th Cir. 2010), for years, but Bausch's rationale was that additional "discovery" could allow plaintiffs to establish a factual basis for FDCA violation claims that juries would ultimately decide. Id. at 560-61. Now (assuming we're right about the overall scope of Albrecht) judges are to decide the sort of preemption-avoidance questions raised in Bausch. So while plaintiffs might still avoid immediate dismissal on the pleadings, targeted discovery and a relatively rapid summary judgment motion should be the rule for parallel claims in the Seventh Circuit.

We caution that nothing in Albrecht means that defendants will win preemption motions all the time – anti-preemption judges will still be anti-preemption - but a lot more preemption cases are going to be decided on the basis of dispositive motions, rather than the can being kicked down the road with a "factual disputes exist" excuse.

Thus, it is quite likely that juries will be hearing fewer regulatory opinions from fewer FDA experts – on both sides. Judges have to decide preemption issues; they can't leave them to juries. Often, but not always, that will be to the defendant's benefit. But Albrecht also probably precludes both sides from conducting preemption-related guerrilla warfare during the trial. Albrecht authorizes courts to refuse, as irrelevant to any question the jury can decide, expert testimony on preemption related issues, such as whether the FDA has imposed this or that "requirement" on a regulated defendant. On the other hand, both plaintiffs and defendants will have to live with more judicial decisions finding preemption to exist, or not to exist, rather than leaving those issues undecided pending trial.

Second, we think that the point made above about increased judicial decisionmaking in preemption cases is particularly true of "clear evidence" determinations under Albrecht's new and (we hope) improved definition:

"[C]lear evidence" is evidence that shows the court that the drug manufacturer fully informed the FDA of the justifications for the warning required by state law and that the FDA, in turn, informed the drug manufacturer that the FDA would not approve a change to the drug's label to include that warning.

Albrecht, 2019 WL 2166393, at *3.

As we mentioned in our breaking news post, any determination in a state-law-based case of whether the FDA was "fully informed" about anything runs headlong into Buckman Co. v. Plaintiffs Legal Committee, 531 U.S. 341 (2001), forbidding plaintiffs in such matters from second-guessing the adequacy of submissions made to the FDA. Preemption under Buckman applies to:

claims [that] would also cause applicants to fear that their disclosures to the FDA, although deemed appropriate by the Administration, will later be judged insufficient in state court. Applicants would then have an incentive to submit a deluge of information that the Administration neither wants nor needs, resulting in additional burdens on the FDA[.]

Id. at 351.

Thus, we don't see Albrecht as providing any basis for allowing plaintiffs to argue to juries that any submission that the FDA found adequate nonetheless provided less than "full information" in some hindsight view. To the extent that any litigation at all of whether the FDA is "fully informed" is permissible after Albrecht, that would appear to be squarely within the realm of judicial competence discussed in our first point.

Third, what happens when a judge does decide preemption-related factual questions that might arise but are "subsumed within an already tightly circumscribed legal analysis"? Albrecht, 2019 WL 2166393, at *9. Here, we look to another patent decision cited in Albrecht, Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., 135 S.Ct. 831 (2015). Teva held that, where judges decide subsidiary factual questions in patent (and presumably post-Albrecht preemption) cases, on appeal such factual resolutions cannot be overturned unless "clearly erroneous." 135 S.Ct. at 836-37 (citing, inter alia, Fed. R. Civ. P. 51(a)(6)). "[T]his rule and the standard it sets forth must apply when a court of appeals reviews a district court's resolution of subsidiary factual matters." Id. at 836. So another significant consequence of Albrecht is that, where judicial determination of "contested brute facts," Albrecht, 2019 WL 2166393, at *9, is necessary to a preemption decision, those findings, on appeal, will likely be subject to relatively deferential "clearly erroneous" appellate review. After all, under Albrecht, all a judge has to do in deciding preemption is "simply ask himself or herself whether the relevant federal and state laws irreconcilably conflict." Id. at *8 (citation and quotation marks omitted).

Thus, both defendants and plaintiffs have even more reason to "be careful what they ask for" when preemption is involved. If a party forces a judicial decision of a disputed factual issue tied to preemption, it must be prepared to live with the outcome. Regardless of what the substantive preemption decision is – pro or con – if it involves resolution of factual disputes, the "clearly erroneous" standard (assuming it applies) will make such decisions, formerly treated as legal issues subject to de novo review, harder to overturn on appeal.

Fourth, there is going to be renewed litigation over the preemptive (and perhaps other) impact of FDA decisions that do not, themselves, have force of law. Justice Thomas's anti-preemption result was based on a constrained view that an FDA "complete response letter" didn't have such force, and therefore could not create a preemptive conflict. Albrecht, 2019 WL 2166393, at *11 (Thomas, J. concurring). While his view appears idiosyncratic on the current Court, the majority opinion does include the statement that FDA disapproval of warnings may be communicated "by means of notice-and-comment rulemaking setting forth labeling standards, by formally rejecting a warning label that would have been adequate under state law, or with other agency action carrying the force of law." Id. at *9 (citations omitted).

Take, for example, the Utah medical device preemption case we discussed recently. The source of detailed preemptive requirements was an FDA guidance document. Kelsey v Alcon Laboratories, Inc., 2019 WL 1884225, at *6-7 (Utah Dist. April 22, 2019). While FDA guidance documents generally do not have force of law, the particular guidance at issue in Kelsey had been incorporated as "special controls" into the device's formal FDA clearance. Id. at *10-11. Thus the preemption ruling in Kelsey should be OK because guidance was incorporated into something else with force of law. However, any preemption argument that depends in part on an FDA action conveyed via something (like a guidance or a letter) that doesn't have force of law, will need to show how, as in Kelsey, that action came to have legal effect in each particular case.

The converse should also be true. Among FDA actions that lack force of law are warning letters, untitled letters, and inspection Forms 483. We've discussed this point numerous times. See here, here, and here. Thus, to the extent that Albrecht requires that preemption stem from FDA actions with force of law, we think that it equally precludes preemption from being opposed by evidence of FDA actions, such as warning letters, that themselves lack force of law.

Fifth, and finally, the preemption as a legal issue holding of Albrecht may also have jurisprudential implications. We've also discussed current initiatives (and even proposed our own) to change the Federal Rules of Civil Procedure that apply (or aren't being applied) to multi-district litigation. One of the proposals that the Federal Judicial Conference's committee on Civil Rules is considering is whether to increase the availability of interlocutory appeals in multi-district litigation. Such appeals would be limited to "important" pre-trial MDL rulings, and of course there is the question of how to define "important."

But one type of MDL ruling that everyone agrees qualifies as "important" is preemption. Now that Albrecht has disconnected preemption decisions from factual disputes that require jury resolution, preemption rulings thereby become much more discrete, and thus collateral to, the rest of any given MDL morass. Thus, Albrecht makes it much easier for the defense side to argue that MDL preemption decisions (including factual determinations arguably subject to "clearly erroneous" appellate review as discussed earlier) are not only important, but procedurally severable, so as to facilitate interlocutory appeal.

We're sure that Albrecht has other aspects that will also be the subject of litigation, but these are the important ones that occur to us right now. We will, of course, address any other Albrecht-related issues as they arise.

This article is presented for informational purposes only and is not intended to constitute legal advice.

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