Justia Drugs & Biotech Opinion SummariesArticles Posted in US Court of Appeals for the Second Circuit
Nguyen v. NewLink
Plaintiffs filed a class action under S.E.C. Rule 10b-5, 17 C.F.R. 240.10b-5, following the failure of NewLink's Phase 3 clinical trial for a novel pancreatic cancer drug and the resulting decline in the market value of NewLink shares. The Second Circuit held that defendants' statements about the efficacy of their pancreatic cancer drug were puffery, not material misrepresentations. However, the court held that plaintiffs plausibly pled material misrepresentation and loss causation for defendants' statements about the scientific literature and the design of their clinical trial. Therefore, the court affirmed the district court's dismissal in part regarding the 2013-2016 Assessments; vacated the dismissal in part regarding the September, March, and Enrollment statements; and remanded for further proceedings. View "Nguyen v. NewLink" on Justia Law
Critcher v. L’Oreal USA, Inc.
The Food Drug and Cosmetic Act's (FDCA) broad preemption clause, 21 U.S.C. 379s, bars plaintiffs from seeking to impose additional or different labeling requirements through their state-law claims, especially when Congress and the FDA already have provided for specific labeling requirements. Plaintiffs filed suit against L’Oréal, alleging common law claims for unjust enrichment and breach of the implied warranty of merchantability, as well as claims under eight state consumer protection statutes. Plaintiffs believed they were being deceived into buying more product, because a portion of each of the liquid cosmetics they purchased could not be extracted. The Second Circuit affirmed the district court's dismissal of the complaint, holding that plaintiffs' state law claims at issue are preempted by the FDCA. In this case, plaintiffs alleged that their injuries resulted from the fact that the labels of the various L’Oréal products omitted certain critical information—specifically, that the creams could not be fully dispensed from their respective containers. Plaintiffs also admit that the packages comply with federal labeling requirements. The court explained that, if plaintiffs were permitted to move forward with their claims, they would be using state law to impose labeling requirements on top of those already mandated in the FDCA and the regulations promulgated thereunder. View "Critcher v. L'Oreal USA, Inc." on Justia Law
Gibbons v. Bristol-Myers Squibb Co.
In this multi-district litigation, plaintiffs brought a series of products liability actions against the makers of Eliquis for injuries they or their decedents suffered while taking the drug. In the multi-district litigation, the district court denied motions to remand many of the actions to state court and then dismissed 64 suits. The Second Circuit affirmed, holding that 28 U.S.C. 1441(b)(2) was no barrier to the removal of the transferred actions at issue. The court held that a home‐state defendant may in limited circumstances remove actions filed in state court on the basis of diversity of citizenship, was authorized by the text of Section 1441(b)(2), and was neither absurd nor fundamentally unfair. The court also affirmed the dismissal of plaintiffs' negligence and strict liability claims as preempted by the Food, Drug, and Cosmetics Act. In this case, plaintiffs' claims consisted of conclusory and vague allegations and did not plausibly allege the existence of newly acquired information. Therefore, plaintiffs' allegations were insufficient to state a claim that was not preempted. View "Gibbons v. Bristol-Myers Squibb Co." on Justia Law
United States v. Scully
A jury found William Scully guilty of mail and wire fraud and conspiracy to commit mail and wire fraud, conspiracy to defraud the United States through the introduction of misbranded drugs into interstate commerce, introduction of misbranded drugs into interstate commerce, receipt of misbranded drugs into interstate commerce and delivery thereof for pay, introduction of unapproved drugs into interstate commerce, and unlicensed wholesale distribution of prescription drugs. He was sentenced principally to 60 months in prison. The main issue on appeal was whether the district court properly excluded evidence relating to Scully’s advice-of-counsel defense. Because the Second Circuit found that the evidence was admissible and its exclusion was not harmless error, it vacated the district court’s judgment and remanded for further proceedings. View "United States v. Scully" on Justia Law