Church & Dwight Co. v. SPD Swiss Precision Diagnostics, GMBH, No. 14 Civ. 00585, 2015 WL 2359467 (S.D.N.Y. Mar. 24, 2015)
Earlier discussion. SPD argued that the FDCA barred Lanham Act false advertising claims against it because the FDA had preapproved its pregnancy test and the labeling thereof. Applying POM Wonderful, the court here disagrees. SPD sold a home pregnancy test kit called the “Clearblue Advanced Digital Pregnancy Test with Weeks Estimator” that estimates the number of weeks that have passed since the woman last ovulated. However, C&D contended that the Weeks Estimator couldn’t provide a pregnancy duration estimate, because the medical profession doesn’t define pregnancy with respect to ovulation but rather at the time of a woman’s last menstrual period. Thus, the name and advertising of the product falsely conveyed the message that the product could tell a woman how many weeks she’d been pregnant.
The Weeks Estimator was a Class II medical device subject to the 510(k) process, which requires the party seeking to market a device to notify the FDA prior to marketing it. The notification requires “a description of the device and a statement of the intended use of the device, the proposed labeling to be included on the device, and the information necessary for the FDA to determine if the device is ‘substantially equivalent’ to a pre-existing device.” The evidence revealed that, “unlike the situation in POM Wonderful in which the challenged product labeling was merely consistent with existing FDA regulations, the Weeks Estimator’s product packaging and at least one internet commercial (though not all of its advertising) were subject to extensive FDA pre-approval.”
The court found that the FDA’s involvement lay somewhere in between “full control” and “permission.” For example, the FDA issued a “Hold Letter” due to a concern that women could misinterpret the results of the Weeks Estimator, with potentially adverse health consequences because the Weeks Estimator would under-estimate gestational age by an average of 2 weeks. The FDA identified specific changes it desired to the Indications for Use and labeling, including removal of the claim “Also Tells You How Far Along You Are.” The Hold Letter also rejected “Conception Indicator,” which was SPD’s initial name for the product. The FDA ultimately accepted “Weeks Estimator,” but there was no indication that it would have rejected a third alternative. Ultimately, SPD received clearance. The Clearance Letter stated that “a new 510(k) is required before these limitations are modified in any way or removed from the device’s labeling.” Further, it said that “FDA’s issuance of a substantial equivalence determination does not mean that FDA has made a determination that your device complies with other requirements of the Act or any Federal statutes and regulations administered by other Federal agencies.”
C&D wrote to the FDA asking it to take “corrective action” against SPD for alleged violations of the Clearance Letter’s labeling restrictions. Its arguments overlapped with its claims in this lawsuit. The FDA reached out to SPD and SPD submitted a “mitigation proposal” for changes in some of its labeling and advertising. The FDA accepted some but not all of these suggestions. The FDA ordered SPD to stop airing its TV commercial because the commercial “still does not convey the limitations of your Week[s] Estimator completely, nor does it clearly state that the device can only estimate weeks since ovulation (and not weeks of pregnancy) and therefore does not present a balanced and accurate description of your device to consumers.” The FDA ultimately approved a modified commercial for internet use only, which “display[s] the [Indications for Use] statement in its entirety, in text and against a blank screen with sufficient time to allow the statement to be read by the viewer.”
The court concluded that there was no doubt that the FDA applied “an extensive pre-approval process.” But did that preclude Lanham Act claims? No. POM Wonderful applies with equal force to medical device labeling. Fruit juice receives less oversight than medical devices, true, but the Supreme Court’s reasoning wasn’t limited to a specific area of the FDCA, and much of its analysis applied with equal force to the rest of the FDCA.
First, POM Wonderful focused on the two statutes as a whole,” emphasizing that they serve different, but complementary, purposes.” The Lanham Act is for competitors, and the FDCA is designed to protect the public health and safety. The Lanham Act uses private enforcement and the FDCA doesn’t. There is an overlap, but not a conflict. Neither statute expressly limits the other, which is important because the two have coexisted since 1946, and Congress knew how to preclude other claims if it wanted to. “By taking care to mandate express pre-emption of some state laws, Congress if anything indicated it did not intend the FDCA to preclude requirements arising from other sources.” Also, the FDA doesn’t have the same expertise as day-to-day competitors do, and those competitors may be more effective at getting rid of unfair competition. “Allowing Lanham Act suits takes advantage of synergies among multiple methods of regulation.”
All these reasons applied with equal force to medical devices, regulation of which has coexisted with the Lanham Act for nearly 40 years. Plus, “Congress amended the FDCA to include a pre-emption provision for medical devices that is substantially similar to the pre-emption provision for food labeling discussed in POM Wonderful.” And “the FDA’s perspective and expertise as compared to the knowledge of day-to-day competitors is at least as limited with respect to medical devices as it is for food and beverage labeling.”
SPD argued that the POM Wonderful opinion carved out Lanham Act claims that challenge labeling the FDA has pre-approved because the opinion noted that “[u]nlike other types of labels regulated by the FDA, such as drug labels, it would appear the FDA does not preapprove food and beverage labels under its regulations and instead relies on enforcement actions, warning letters, and other measures.” However, the Supreme Court rejected almost identical arguments in two separate cases: First, in POM Wonderful itself, the Court rejected the Government’s position as amicus that distinguished label elements specifically authorized or required by FDA regulations from other label elements. In addition to practical line-drawing concerns, that argument wrongly assumed that the FDCA was a ceiling on food and beverage regulation, but in fact the Lanham Act complemented the FDCA, making FDA pre-approval beside the point.
Second, the Court rejected an almost identical pre-approval argument in Wyeth v. Levine, 555 U.S. 555 (2009), a preemption case otherwise on all fours with the facts here. The Court declined to find pre-approval enough to preempt state claims, because state law remedies further consumer protection, and because Congress’s decision to expressly preempt medical device claims contrasted with its silence on drugs. As in POM Wonderful, Congress’s silence in the face of its awareness of these causes of action, plus the FDA’s limited monitoring resources, justified the non-preemption of tort suits. “Since the FDA’s pre-approval of medical device packaging is at least as rigorous as its pre-approval of drug labeling, Wyeth’s pre-emption analysis informs this Court’s approach to FDCA preclusion of the Lanham Act.”
Although POM Wonderfuldidn’t involve pre-approval, the fact that the FDCA is not a ceiling on medical device regulation means that pre-approval isn’t a distinguishing element. SPD argued that the FDA’s Hold and Clearance Letters indicated the FDA’s intent to be the final word, but “[i]t is for Congress, not the FDA, to determine whether the FDCA and its regulations are a ceiling on the regulation of medical devices.” Plus, the court doubted the FDA would agree with SPD’s position: the Clearance Letter expressly says that “FDA’s issuance of a substantial equivalence determination does not mean that FDA has made a determination that your device complies with other requirements of the Act or any Federal statutes and regulations administered by other Federal agencies.” There was no other indication that the FDA intended to preclude Lanham Act claims.
SPD finally invoked Geier v. American Honda Motor Co., 529 U.S. 861 (2000), which held that an “action was barred because it directly conflicted with the agency’s policy choice to encourage flexibility to foster innovation.” But, as in POM Wonderful, SPD couldn’t find FDA actions discussing the Lanham Act, and there was no indication that the FDA considered “the full scope of the interests the Lanham Act protects.”
Two post-POM cases raised similar issues. Catheter Connections, Inc. v. Ivera Medical Corp., No. 2.T4–CV–70–TC, 2014 U.S. Dist. LEXIS 98206 (D.Utah July 17, 2014), found that the only precluded claim was an assertion that the defendant “has not complied with FDCA Section 510(k),” which would require the court to decide in the first instance whether Section 510(k) clearance is required—a determination left exclusively to the FDA. Claims focused on the “substance of [defendant’s] representations in the context of the medical device market and what drives buyers’ purchasing decisions” were not precluded—consistent with the holding here.
JHP Pharmaceuticals, LLC v. Hospira, Inc., No. CV 13–07460, 2014 U.S. Dist. LEXIS 142797 (C.D.Cal. Oct. 7, 2014), suggested that pre-approval could justify preclusion, but the court here disagreed; JHP didn’t address the Court’s rejection of the Government’s argument in POM or the similarity to Wyeth.
The only remaining question was whether C&D was trying to enforce the FDCA (not okay) or bringing a separate Lanham Act claim. C&D’s claims would only require the Court to “determine the message conveyed to consumers by SPD’s marketing and then determine whether that message is either literally false or likely to mislead and confuse consumers.” Nothing “requires the Court to interpret, apply, or enforce the FDCA, the FDA’s regulations, or the Clearance Letter.” SPD argued that, by challenging these claims, C&D inherently challenged the FDA’s approval of the safety/accuracy of the device. But C&D wasn’t trying to overturn clearance of the device for pregnancy detection and estimation of weeks since ovulation. The FDA didn’t indicate that SPD couldn’t change the label or the name (other than calling it “Conception Indicator”).
True, SPD “might find itself stuck between a rock and a hard place, trying to honor the FDA’s wishes while avoiding Lanham Act liability.” But Wyeth indicates that’s not dispositive: “A mere finding that a medical device is falsely advertised does not necessarily proscribe use of a device that the FDA has pre-approved or labeling that the FDA has required … [T]here may be any number of ways to advertise the product that do not mislead consumers and comply with FDA requirements.” SPD can make changes to the labeling with FDA approval, and there was no clear evidence that the FDA wouldn’t approve a change, which means that complying with both laws wouldn’t be impossible.