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SCOTUS for law students (sponsored by Bloomberg Law): Preemption again

On its face, the concept of preemption does not seem especially complicated: when federal law and state law clash, federal law prevails. This is the direct result of Article VI, section 2 of the Constitution, which makes the Constitution and federal laws “the supreme law of the land.”

However, the doctrine of federal preemption has been anything but simple and straightforward in recent Supreme Court cases dealing with the interplay of federal prescription drug regulations and state tort laws. Next week, the Justices will wade into this thicket for the third time in just four years.

And if you consider preemption issues in contexts other than federal drug regulation, the Court has handled a dozen preemption cases in the last five years. These have ranged from a challenge to a controversial state immigration law, in Arizona v. United States (2012),  to decisions about the safety of medical devices, Riegel v. Medtronic, Inc. (2008), to civil rights suits by prison inmates against corrections officers, Haywood v. Drown (2009).

Why are the Justices paying so much attention to preemption?  Although preemption sounds like a technical concept, for many Justices, it raises fundamental questions about the balance between state and federal power.  As Justice Thomas noted a few years ago, quoting an earlier Supreme Court decision, the Supremacy Clause gives the federal government “a decided advantage” in the “delicate balance” between state and federal power. Thus preemption often splits the Court on ideological grounds similar to other decisions involving federalism.

According to the Court’s rulings, preemption may be either express or implied. It is express when Congress states clearly in a federal law that it intends to supersede related state laws. The only remaining question in such cases is whether a particular state law is of the type that Congress preempted.

There tends to be more disagreement among the Justices in cases involving implied preemption. The Court has found preemption implied in several different scenarios. One, known as “field preemption,” occurs when Congress, without expressly declaring that state laws are preempted, nevertheless legislates in a way that is so comprehensive as to occupy the entire field of an issue. A second form of implied preemption – and the source of much recent disagreement among the Justices – is known as “conflict” preemption. According to recent Court decisions, conflict preemption occurs either (1) when it is impossible for someone to comply with both state and federal laws, or (2) when the purposes and objectives of federal law would be thwarted by state law. These two scenarios, not surprisingly, are commonly known as “impossibility” preemption and “purposes and objectives” preemption.

Implied preemption in a lawsuit over generic drugs is the focus of Mutual Pharmaceutical Co. v. Bartlett, in which the Court will hear arguments on March 19. In 2004, respondent Karen Bartlett was prescribed an anti-inflammatory drug, known in its generic form as sulindac, to ease her shoulder pain. However, in rare instances – including for Bartlett – the drug causes a reaction in which the body sheds skin in large quantities. Bartlett, a New Hampshire resident, lost about two-thirds of her skin, spent months in the hospital, and suffered near blindness and other permanent damage. Bartlett sued under New Hampshire law. After various court rulings (not now at issue before the Supreme Court) narrowed the focus of the lawsuit, a federal jury awarded Bartlett $21.06 million in compensatory damages on the theory that the drug design was defective. Both the federal district court and the U.S. Court of Appeals for the First Circuit rejected the argument by the manufacturer of the generic drug, Mutual Pharmaceutical Co., that state tort law claims based on defective drug design are preempted by federal regulation under the Federal Food, Drug and Cosmetic Act and the Drug Price Competition and Patient Term Restoration Act of 1984.

How do the preemption issues play out in this case? Some recent legal background is in order. Tort law cases involving pharmaceuticals often raise either or both of two major issues; one issue is the failure to adequately warn of the dangers of a drug, while the other is the design defect claim. Four years ago, in Wyeth v. Levine, the Supreme Court ruled that a failure-to-warn claim under Vermont tort law was not preempted by federal law. That case was brought by Diana Levine, a professional musician whose arm had to be amputated after a drug, Phenergan, was injected directly into her blood instead of being administered in a drip solution. By a vote of six to three, the Court held that Wyeth, the manufacturer of the drug, could have added to its packaging a stronger warning about the risks of injecting the drug. There was no preemption, the Court explained, because federal regulation left room for Wyeth to alter its warning labels and because Congress did not specify any intent to preempt state failure-to-warn claims. That decision was authored by now-retired Justice Stevens over a dissent by Justice Alito, who was joined by the Chief Justice and Justice Scalia. Justice Thomas agreed with the result in the case, but he also wrote a separate opinion in which he expressed strong doubts about the Court’s general willingness to consider implied preemption claims based on interference with the “purposes and objectives” of federal laws.

But two years ago, the Court majority shifted. In Pliva Inc. v. Mensing, the Court ruled, by a vote of five to four, that when it comes to generic drugs, federal law preempts any state laws that would require a manufacturer to make changes in a drug label to provide more warning. Justice Thomas found that the case presented an example of “impossibility,” because generic drug manufacturers were not permitted under federal regulation to make label changes. That case involved lawsuits by two plaintiffs who alleged that they contracted a neurological disorder known as tardive dyskinesia from prolonged use of the generic drug metoclopramide, which was prescribed for digestive tract problems. Over a strong dissent by Justice Sotomayor, who was joined by Justices Ginsburg, Breyer, and Kagan, the Court – in an opinion by Justice Thomas – concluded that preemption rules apply differently to generic drug manufacturers than to brand-name drug producers.

That ruling tees up the question before the Court next week in Bartlett. The First Circuit interpreted the Court’s decision in Wyeth as advancingt a general presumption against preemption in clashes between state tort law and federal drug regulation. But it also noted that the subsequent Pliva decision carved out an exception, finding that preemption should apply to generic drugs to preclude failure-to-warn claims under state tort law.

So the question in Bartlett is whether the Supreme Court will again say that generic drugs are different and entitled to more protection under federal preemption when the case involves an alleged design defect. The generic drug manufacturers argue that the issue is similar to the failure-to-warn case because they are not at liberty to alter the drug to make it safer and therefore have no ability to deal with the design defect.

The First Circuit was not persuaded of this argument, however, in part because the Court indicated that the generic drug manufacturer did have one simple solution – to stop selling a product that has a medically dangerous design. But that solution, the generic drug manufacturers say, would thwart the “purposes and objectives” of Congress, which made clear in the 1984 law that it wanted to promote the availability of generic drugs.

Thus, the preemption issues are joined in this latest case involving preemption and generic drug manufacturers and federal regulation. As is often the case in such disputes, preemption attracts important players to the Supreme Court table. On the manufacturer’s side, the Solicitor General has urged the Court to hold that the design defect claim is preempted, as has the U.S. Chamber of Commerce.

On the other side, Bartlett’s lawyers argue that New Hampshire law neither conflicts with federal law nor mandates a change in the product; it simply provides just compensation for those injured by a product. Her position is supported by two former U.S. Food and Drug Commissioners, Donald Kennedy and David Kessler, and by two Democratic lawmakers, Sen. Tom Harkin of Iowa and Rep. Henry Waxman of California.

When the Supreme Court rules in the case later this spring or early this summer, its decision not only will have an important impact on the generic drug industry but will also add to the burgeoning body of preemption law that continues to preoccupy the Justices.

Recommended Citation: Stephen Wermiel, SCOTUS for law students (sponsored by Bloomberg Law): Preemption again, SCOTUSblog (Mar. 11, 2013, 11:05 AM),