FDA pre-approval doesn’t bar Lanham Act false advertising claim against device

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 Wonderful
didn’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.
 

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