In re MDL 2700 Genentech Herceptin Marketing and Sales Practice Litigation.
No. 19-5035. N.D.Okla. Judge Briscoe. Multi-District Litigation—Federal Preemption—Obstacle Preemption—Impossibility Preemption.
May 25, 2020
This appeal arose from a group of 14 diversity cases that were consolidated by the Judicial Panel on Multidistrict Litigation. The plaintiffs in each case are cancer treatment providers who purchased multi-dose vials of Herceptin, a breast cancer drug, from defendant. Plaintiffs alleged that defendant violated state law by misstating the drug concentration and volume on the product labeling, and by failing to ensure that each vial contained the labeled amount of the active ingredient. The claims included breach of express and implied warranties and unjust enrichment.
Following consolidation, defendant moved for summary judgment on the basis that the state law claims were preempted by federal law, arguing that the Public Health Service Act (PHSA) and the Food, Drug, and Cosmetic Act (FDCA) preempt the state law claims. Specifically, defendant contended that the state law claims were precluded by both obstacle preemption and impossibility preemption. The district court granted the summary judgment motion.
On appeal, plaintiffs challenged the district court’s grant of summary judgment, specifically its conclusions that obstacle preemption and impossibility preemption bar their claims. The production and marketing of biologics such as Herceptin is governed by both the PHSA and the FDCA. Preemption arises where (1) Congress defines explicitly the extent to which its enactments preempt state law; (2) in the absence of explicit language, Congress intends the federal government to occupy exclusively the regulatory field; and (3) state law conflicts with federal law, which includes both obstacle and impossibility preemption doctrines. It is undisputed that Congress did not include an express preemption provision in either the PHSA or the FDCA, nor is there evidence that Congress intended the federal government to occupy the field. The Tenth Circuit analyzed whether a conflict exists between state and federal law.
Obstacle preemption exists when the challenged state law is an obstacle to the accomplishment and execution of Congress’s purposes and objectives. Under the FDCA, the Food and Drug Administration establishes general labeling standards but does not routinely enforce those standards, which leaves room for the states to impose their own requirements as long as they do not conflict with the federal regulatory scheme. Here, the state law claims were consistent with the federal framework, so obstacle preemption did not apply.
Impossibility preemption exists “when it is impossible for a private party to comply with both state and federal requirements.” Concluding that Herceptin is a “liquid drug,” the Tenth Circuit held that the labeling duty imposed by federal regulations was the same as that imposed under the state law claims, and it was not impossible for defendant to comply with both sets of laws. Therefore, impossibility preemption did not apply.
The grant of summary judgment was reversed and the case was remanded for further proceedings.