JHP Pharmaceuticals LLC v. Hospira Inc et al

Filing 76

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS MOTIONS TO DISMISS 60 , 61 by Judge Dean D. Pregerson . (lc). Modified on 10/7/2014 (lc).

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UNITED STATES DISTRICT COURT

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CENTRAL DISTRICT OF CALIFORNIA

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JHP PHARMACEUTICALS, LLC,a
Delaware limited liability
company,

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Plaintiff,
v.
HOSPIRA, INC., a Delaware
corporation; INTERNATIONAL
MEDICATION SYSTEMS, LTD., a
Delaware corporation; and
AMERICAN REGENT, INC., a New
York corporation,

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Defendants.
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Case No. CV 13-07460 DDP (JEMx)
ORDER GRANTING IN PART AND
DENYING IN PART DEFENDANTS’
MOTIONS TO DISMISS
[Dkts 60 & 61]

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Presently before the court are two motions to dismiss the

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complaint brought by Par Sterile Products, LLC, against the

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Defendants American Regent, Inc., Hospira, Inc., and International

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Medical Systems, Ltd.

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advertising and labeling, based on the Lanham Act and equivalent

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state statutes.

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this Court, in deciding the case, would intrude on matters Congress

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has left exclusively to the discretion of the FDA.

The complaint alleges false or misleading

The Defendants’ motions essentially argue that

The Plaintiff,

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on the other hand, argues that its complaint does not rest on

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matters requiring the expertise and authority of the FDA to

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resolve, and dismissal is not appropriate.

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For reasons discussed below, the Court grants the motions in

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part and denies them in part.

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I. BACKGROUND

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A. Factual Background1

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Par Sterile Products, LLC (“Par”) is a manufacturer of
injectable epinephrine under the brand name ADRENALIN.

Defendants

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American Regent, Inc. (“American Regent”), Hospira, Inc.

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(“Hospira”), and International Medical Systems, Ltd. (“IMS”)

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(collectively, “Defendants”) are manufacturers of other injectable

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epinephrine products.

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In 2012, Par (then known as JHP Pharmaceuticals, LLC)

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submitted a New Drug Application (“NDA”) for its 1 mL and 30 mL

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injectable epinephrine products to the U.S. Food and Drug

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Administration (“FDA”) under the brand name ADRENALIN. (Compl. ¶¶

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3-4.)

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the Food, Drug, and Cosmetic Act (“FDCA”), granted JHP approval to

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market and sell the 1 mL version of ADRENALIN. (Id. ¶¶ 5-6.)2

On December 7, 2012, the FDA, pursuant to its power under

Par

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Both Par and Defendants Hospira and IMS have submitted to the
Court additional material in support of their positions.
“Generally, a district court may not consider any material beyond
the pleadings in ruling on a Rule 12(b)(6) motion.” Hal Roach
Studios, Inc. v. Richard Feiner & Co., Inc., 896 F.2d 1542, 1555
n.19 (9th Cir. 1989). Therefore, the Court declines to consider,
in ruling on these motions, either the Declaration of Harold
Storey, submitted by Par, or the Declaration of Jeffrey LeVee,
submitted by Hospira and IMS. This section draws exclusively from
the complaint for the facts alleged.
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The NDA for the 30 mL ADRENALIN product was still pending at
the time JHP filed its complaint. (Compl. ¶ 4.)
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alleges that it invested millions of dollars in complying with the

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FDA approval process. (Id. ¶¶ 50-51.)

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Par alleges that the Defendants all sell injectable

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epinephrine products which are not FDA-approved (Compl. ¶¶ 55, 57),

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an allegation which no Defendant denies.

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Defendants mislead the public in four different ways.

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Par also alleges that the

First, Par alleges that the Defendants represent to consumers,

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either overtly or through misdirection, that their products are

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FDA-approved, when they are not.

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(Compl. ¶ 71.)

Second, Par alleges that the Defendants misleadingly advertise
their products as “safe” and “effective.”3
Third, Par alleges that the Defendants advertise products that

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are “illegal” to sell or market under the FDCA (Id. ¶¶ 56-57),

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while representing to wholesalers and the public that they abide by

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the law.

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wholesalers and the public as to the legality of their products.

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Par thus alleges that the Defendants are misleading

Fourth, Par alleges that the Defendants omit from their

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product labeling certain injection location and adverse reaction

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information that Par’s product must carry as part of its FDA-

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approved labeling.

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thinking that Par’s product is more dangerous than the generics,

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because it can only be administered in certain locations and can

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cause certain adverse reactions.

This, Par contends, misleads the public into

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Throughout the complaint, Par’s constant refrain is that the
Defendants market their products as “safe, effective, and
FDA-approved.” (Compl. ¶ 71.) However, for reasons that will be
explained below, the Court finds it appropriate to separate the
safety/effectiveness issues from the question of FDA approval.
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Par asserts a claim against the Defendants for each of these

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representations under the Lanham Act, 15 U.S.C. § 1125(a)(1), which

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forbids false or misleading advertising.4

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injury, in the form of both competitive disadvantage and harm to

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reputation and goodwill.

Par also alleges actual

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Defendants counter that Par’s Lanham Act claims should be

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dismissed, either because they are precluded altogether by the

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FDCA, because Par has failed to exhaust its administrative

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remedies, or because the FDA has primary jurisdiction over the

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claims and the case should be referred to the agency for a ruling.

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(Def. American Regent’s Mot. Dismiss, § II; Defs. Hospira and IMS’s

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Reply, § I; Def. American Regent’s Reply, “Argument.”)

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Hospira and IMS also raise the issue of the factual sufficiency of

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Par’s claims.

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B. Procedural Background

Defendants

(Defs. Hospira and IMS’s Mot. Dismiss, § I.C.2.)

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The initial complaint in this matter was filed on October 8,

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2013, and the Defendants filed motions to dismiss on November 27,

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2013.

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on the motions.

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denied without prejudice and the case stayed, pending the

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resolution of another Lanham Act/FDCA case in the Supreme Court,

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POM Wonderful LLC v. Coca-Cola Co., 134 S.Ct. 2228 (2014).

On February 3, 2014, Judge Michael Fitzgerald held a hearing
Ultimately, however, the Court ordered the motions

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Par also alleges violations of the California Business and
Professions Code, §§ 17200 and 17500, which similarly prohibit
misleading advertising. These state law claims, however, are not
substantively addressed in the motions currently under
consideration, however, as all Defendants agree that the state
claims are “substantially congruent” to the Lanham Act claims.
(Def. American Regent’s Mot. Dismiss, § III.A.; Defs. Hospira and
IMS’s Mot. Dismiss, § II.) Par similarly focuses its arguments in
opposition on the Lanham Act claims.
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POM Wonderful was decided June 12, 2014.

On June 19, 2014,

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the Plaintiff in this case filed notice of the decision, and on

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July 23, 2014, the Defendants filed new motions to dismiss, which

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are the subject of this order.

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II. LEGAL STANDARD

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A complaint may be dismissed under Rule 12(b)(6) only if it

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“either (1) lacks a cognizable legal theory or (2) fails to allege

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sufficient facts to support a cognizable legal theory.”

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Apple, Inc., 729 F.3d 953, 959 (9th Cir. 2013).

Somers v.

“All allegations

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of material fact in the complaint are taken as true and construed

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in the light most favorable to the plaintiff.”

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Products Co., 552 F.3d 934, 937 (9th Cir. 2008).

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well-pleaded factual allegations, a court should assume their

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veracity and then determine whether they plausibly give rise to an

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entitlement to relief.”

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(2009).

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III. DISCUSSION

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A. Failure to Exhaust Administrative Remedies

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Williams v. Gerber
“When there are

Ashcroft v. Iqbal, 556 U.S. 662, 679

American Regent, alone among the Defendants, raises the issue

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of failure to exhaust administrative remedies.

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21 C.F.R. § 10.45(b), citizens are required to submit a Citizen’s

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Petition to the FDA “before any legal action is filed in a court

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complaining of the [agency’s] action or failure to act.”

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Par’s claim that the FDA had acted unlawfully, or that the FDA had

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failed to act where it was required to do so, exhaustion would come

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into play.

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the FDA.

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even possible, here.

It notes that under

Were

Par makes no such claim, nor indeed any claim against

Exhaustion of administrative remedies is not required, or

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B. The Lanham Act, the FDCA, and the Scope of the POM Wonderful

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Holding

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Because this action was stayed pending the outcome of the POM

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Wonderful case in the Supreme Court, this Court begins its analysis

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with the question of how, if at all, that decision has changed the

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law of preclusion with regard to Lanham Act cases and the FDCA.

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The Lanham Act broadly regulates representations made in the

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course of commerce.

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person who “uses in commerce any . . . false or misleading

It creates a cause of action against any

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description of fact, or false or misleading representation of fact,

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which . . . misrepresents the nature, characteristics [or]

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qualities . . . of his or her or another person's goods, services,

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or commercial activities.”

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the Act is “to protect persons engaged in such commerce against

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unfair competition” and “to prevent fraud and deception.” 15 U.S.C.

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§ 1127.

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15 U.S.C. § 1125(a)(1).

The purpose of

The Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. §§ 301-

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399f, on the other hand, is intended “primarily to protect the

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health and safety of the public at large.”

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Ct. at 2234.

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advertising of drugs, see 21 U.S.C. § 352, enforcement is not

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through a private cause of action, but almost exclusively through

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the actions of the FDA.

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states may initiate enforcement actions, “all such proceedings for

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the enforcement, or to restrain violations, of this chapter shall

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be by and in the name of the United States.”

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POM Wonderful, 134 S.

Although the FDCA, too, regulates the labeling and

Apart from a few situations in which

21 U.S.C. § 337.

The Lanham Act and the FDCA are thus two discrete statutory
schemes that can regulate the advertising, marketing, and labeling
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of food and drugs.

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Wonderful, the Supreme Court held that “the FDCA and the Lanham Act

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complement each other” and that “Congress did not intend the FDCA

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to preclude Lanham Act suits . . . .”

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Court noted that while “[e]nforcement of the FDCA and the detailed

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prescriptions of its implementing regulations is largely committed

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to the FDA,” that agency “does not have the same perspective or

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expertise in assessing market dynamics that day-to-day competitors

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possess.”

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Neither, however, precludes the other.

Id. at 2238.

134 S. Ct. at 2241.

In POM

The

Thus, the two statutes serve different

functions and draw on different areas of expertise.
On the other hand, while articulating a broad vision of the

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statutes as compatible and complementary, the Court did, in

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passing, preserve the possibility that some Lanham Act suits might

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be precluded by the FDCA:

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Unlike other types of labels regulated by the FDA, such as

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drug labels, it would appear the FDA does not preapprove food

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and beverage labels under its regulations and instead relies

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on enforcement actions, warning letters, and other measures.

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Id. at 2239 (citation omitted) (emphases added).
This passage suggests that, at a minimum, the Court might find

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a Lanham Act claim precluded by the FDCA where it turns on the

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content of a drug label, especially if that drug label were pre-

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approved by the FDA.

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The Court further suggested, referencing Geier v. American

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Honda Motor Co., 529 U.S. 861 (2000), that a Lanham action might be

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barred where “the agency enacted a regulation deliberately allowing

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manufacturers to choose between different options,” or where the

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Plaintiff’s grounds for the Lanham Act claim otherwise conflict
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with an affirmative policy judgment by the FDA.

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S. Ct. at 2241.

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POM Wonderful, 134

There also exists a considerable body of circuit law, pre-POM

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Wonderful, counseling restraint by courts in approaching Lanham

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suits with regard to food and drug labeling and advertising.

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example, the Ninth Circuit held, in PhotoMedex, Inc. v. Irwin, 601

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F.3d 919 (9th Cir. 2010), that “a private action brought under the

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Lanham Act may not be pursued when, as here, the claim would

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require litigation of the alleged underlying FDCA violation in a

For

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circumstance where the FDA has not itself concluded that there was

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such a violation.”

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PhotoMedex was the primary case relied on by the lower courts

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in POM Wonderful, and although it was not specifically overruled,

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its precedential value may be limited.

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recognized that the FDCA did not fully bar Lanham Act claims, where

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the law was clear and did not require the FDA’s expertise or

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rulemaking authority to determine:

But even PhotoMedex

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If, for example, it was clear that an affirmative statement of

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approval by the FDA was required before a given product could

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be marketed and that no such FDA approval had been granted, a

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Lanham Act claim could be pursued for injuries suffered by a

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competitor as a result of a false assertion that approval had

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been granted.

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PhotoMedex, 601 F.3d at 924-25 (emphasis added).

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circuits have similarly concluded that where the issue of FDA

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approval is straightforward, a Lanham action is viable.

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Alpharma, Inc. v. Pennfield Oil Co., 411 F.3d 934, 939 (8th Cir.

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2005) (surveying the precedent of multiple circuits and concluding
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And other

See

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that Lanham Act claims “concerning representations of FDA approval”

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are viable unless they would require a “preemptive determination”

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of an issue within the FDA’s exclusive authority).

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Thus, although the extent of the shift in doctrine after POM

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Wonderful is not entirely clear, both the Supreme Court in that

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case and the Circuits in prior case law make clear two things.

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First, Lanham Act claims (even with regard to FDA approval) are

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not, as a general matter, precluded or barred by the FDCA.

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second, some claims may require the expertise of the FDA to

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But

resolve.

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Given the strong holding in favor of Lanham claims in POM

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Wonderful, all Defendants understandably seek to limit the reach of

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that decision, arguing that the case and its holding were about

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food labels only and did not reach the labeling, marketing, or

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advertising of drugs.

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does not support that view.

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The broad language of the opinion, however,

It is true that the Court makes frequent mention of “food and

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drink” or “food and beverage” in the course of its opinion, e.g.,

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POM Wonderful, 134 S. Ct. at 2334 (“The FDCA prohibits the

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misbranding of food and drink.”); id. at 2237 (“[F]ood and beverage

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labels regulated by the FDCA are not, under the terms of either

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statute, off limits to Lanham Act claims.”); id. at 2238 (“Although

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both statutes touch on food and beverage labeling . . . .”); etc.

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And, as noted above, the Court suggests a difference between food

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labeling, which is not subject to FDA pre-approval, and drug

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labeling, which is.

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Id. at 2239.

But the arguments, logic, and holding of POM Wonderful are
couched in much broader language and strongly suggest a more wide9

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ranging application.

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Lanham Act draws on the market expertise of competitors, id. at

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2238, does not depend on anything peculiar to food and beverage

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labeling.

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the FDCA, in express terms, forbids or limits Lanham Act claims

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challenging labels that are regulated by the FDCA,” id. at 2237;

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nor does its point that “the Lanham Act and the FDCA have coexisted

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since the passage of the Lanham Act in 1946" and Congress has never

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sought to address preclusion by one or the other.

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For example, the Court’s argument that the

Nor does its argument that “neither the Lanham Act nor

Id.

The logical building blocks of the Court’s specific holding

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with regard to food and beverage labeling would seem to be equally

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applicable to food and beverage advertising, drug marketing,

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medical device labeling, cosmetics branding, or any other kind of

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marking or representation which would fall under both the Lanham

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Act and the FDCA, unless preclusion is required for some specific

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reason.5

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that Lanham Act claims with regard to FDCA-regulated products are

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permissible and, indeed, desirable.

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Act suits takes advantage of synergies among multiple methods of

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regulation.”).

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C. Par’s Lanham Act Claims

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The general presumption following POM Wonderful, then, is

Id. at 2231 (“Allowing Lanham

Having established POM Wonderful’s general presumption in

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favor of Lanham Act claims and against preclusion, the Court now

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turns to each of Par’s bases for its claims.

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As noted above, the Supreme Court suggested two such reasons
in POM Wonderful: the FDA may have pre-approved a particular
labeling scheme, as in the labeling of FDA-approved drugs; or the
agency may have authorized a menu of possible lawful choices for
manufacturers, as was the case in Geier. (The common element, of
course, is positive regulatory action in the matter by the FDA.)
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1. FDA Approval

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Par’s fundamental argument with regard to FDA approval is that

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it is a sort of “Good Housekeeping Seal” for pharmaceuticals: it is

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the government’s imprimatur on a product, indicating quality,

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safety, and desirability.

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without FDA approval, Part III.C.3 infra, if a product has been

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approved, consumers may take some assurance that it has been

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properly tested and meets the agency’s minimum quality standards.

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This makes an FDA-approved product a more attractive product,

Although some drugs may be lawfully sold

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whether at the wholesale, retail, or end user level.

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also be expensive to get approval for a drug, so a company that

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chooses to invest in getting approval may operate at a competitive

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disadvantage if other companies can falsely represent to the public

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that their unapproved products are FDA-approved.

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representations that a drug is approved when it is not undermine

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the Lanham Act’s public policy goals both by confusing consumers

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and by enabling unfair competition by producers who have not

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bothered to get FDA approval.

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But it can

Thus,

Par alleges that Defendants have misrepresented their products

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as being FDA-approved in several ways.

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Hospira advertises its product “as an NDA product . . . when, in

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fact, Hospira has not obtained FDA approval of such an NDA.”

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(Compl. ¶ 70.)

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advertises that Par’s ADRENALIN is the “brand name equivalent” of

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its own product, and that it is a “generic” version of Par’s

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product.6

First, Par alleges that

Second, Par alleges that Hospira, at least,

In a more general way Par alleges that Defendants

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Par introduced these specific allegations against Hospira
(continued...)
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encourage purchasers to think of their products as “comparable to

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or interchangeable with” Par’s product.

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contends that consumers will believe that Defendants’ unapproved

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products are interchangeable with Par’s approved one.

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alleges that Defendants advertise via certain industry lists, and

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that consumers expect the products on such lists to be “branded

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drugs or generic products,” although Defendants’ products are not

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“generics” as defined by the FDA.

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(Id. at ¶ 101.)

Par

Finally, Par

(Id. at ¶ 70.)

Defendants argue that claims based on such factual allegations

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are precluded, even post-POM Wonderful.

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cites to a recent case in the District of Utah, where the court

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found precluded a company’s Lanham claim that a competitor was

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“falsely advertising that the current [medical device] model has

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FDA approval.” Catheter Connections, Inc. v. Ivera Med. Corp., No.

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2:14-CV-70-TC, 2014 WL 3536573, *1, *6 (D. Utah July 17, 2014).

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But that case dealt with re-approval of new models of existing

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medical devices, a circumstance under which the FDA leaves it to

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the manufacturer, in the first instance, to determine whether it

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must apply for approval again or assume that the approval carries

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over.

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claim that its product was, in fact, approved, at least until the

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FDA determined otherwise–a determination that would, of course, be

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entirely within the agency’s purview.

Id. at *5.

Defendant American Regent

Thus, the manufacturer there could plausibly

That is obviously very

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(...continued)
only at oral argument. Ordinarily, the Court would be reluctant to
consider such late allegations as part of the complaint. However,
because they sharpened the debate during oral argument, were
adequately argued by Defendants, and were consistent with the
other, more general allegations in the Complaint, the Court
includes them in this discussion.
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different from the present case, where the Defendants have never

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had (and do not claim to have had) their products approved in the

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first place.

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In short, Par’s claim is not precluded.

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Defendants also argue that Par’s claim falls under the

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“primary jurisdiction” of the FDA.

Under the primary jurisdiction

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doctrine, a court, though having jurisdiction to hear the

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complaint, may in some situations be required to “refer” the matter

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to an administrative agency for resolution of a particular

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technical issue.

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(“[C]laims properly cognizable in court [may] contain some issue

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within the special competence of an administrative agency.”).

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doctrine applies where there is “(1) the need to resolve an issue

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that (2) has been placed by Congress within the jurisdiction of an

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administrative body having regulatory authority (3) pursuant to a

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statute that subjects an industry or activity to a comprehensive

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regulatory scheme that (4) requires expertise or uniformity in

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administration.” United States v. Gen. Dynamics Corp., 828 F.2d

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1356, 1362 (9th Cir. 1987).

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See Reiter v. Cooper, 507 U.S. 258, 268 (1993)

The

There is no need to invoke primary jurisdiction doctrine as to

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this claim.

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determine whether the FDA has granted approval or not; nor are

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there “uniformity of administration” concerns in the court making

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that simple factual determination.

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comprehensive list of approved drugs, see FDA, “Drugs@FDA,”

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FDA.gov,

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http://www.accessdata.fda.gov/scripts/cder/drugsatfda/index.cfm

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(last visited Aug. 28, 2014), and while there may be cases where

In this instance, it takes no special expertise to

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The FDA itself maintains a

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approval is a gray area, no Defendant has argued that this is one.

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Indeed, the fact that the Defendants’ drugs are unapproved is not

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contested by any party.

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The same thing is true of the term “generic.”

To be declared

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a “generic” drug by the FDA, a product must go through an approval

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process prescribed by the agency.

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and Answers,” FDA.gov (Sept. 3, 2013),

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http://www.fda.gov/Drugs/ResourcesForYou/Consumers/QuestionsAnswers

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/ucm100100.htm.

See “Generic Drugs: Questions

But the FDA maintains lists of approved generics,

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just as it does for brand-name products.

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alleges is that Defendants are advertising their products as

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approved generics when they are not in fact approved, the Court

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need not refer the question to the FDA’s expertise to make factual

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determinations.

Id.

If all that Par

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Primary jurisdiction is not a bar to Plaintiff’s claims here.

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Defendants also allege that Par’s complaint is factually

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insufficient to support its Lanham claim.

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Par has not alleged specific statements by the Defendants

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representing that their products are FDA-approved.

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cite primarily to Mylan Labs., Inc. v. Matkari, 7 F.3d 1130 (4th

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Cir. 1993) for the proposition that a plaintiff cannot show that

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the defendant implied FDA approval solely by introducing evidence

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that the defendant put the product on the market.

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Defendants argue that

Defendants then

With regard to Defendant Hospira, Par has, in fact, alleged a

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specific representation: Par alleges that Hospira advertises its

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product as “an NDA product.”

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precisely the same as saying that the product is “FDA-approved,” it

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could easily be construed that way by the public, who should not

(Compl. ¶ 70.)

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While that is not

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bear the burden of uncovering information that contradicts the

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impression given by misleading advertising.

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Gerber Products Co., 552 F.3d 934, 939-40 (9th Cir. 2008) (holding

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that the misleading labeling of a largely juice-free candy as

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“fruit juice snacks” was not saved from a false advertising claim

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by an FDA-approved ingredient list on the side of the box).

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Therefore Par has made a plausible allegation that Hospira has made

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misleading statements about its products’ FDA approval status.

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See, e.g., Williams v.

With regard to the other two defendants, however, it is not so

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clear.

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point: merely putting the product on the market is probably not a

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representation that the product is FDA-approved.

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of the factual spectrum, the Ninth Circuit has said that an actual

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“false assertion” that the product was approved could sustain a

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Lanham Act claim where “it was clear that . . . no such FDA

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approval had been granted.”

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Mylan, though not binding on this Court, makes a compelling

At the other end

PhotoMedex, 601 F.3d at 924-25.

Par’s complaint falls somewhere between those two clear poles.

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With regard to American Regent and IMS, at least, Par alleges no

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overt “false assertion.”

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subtle than that of the plaintiff in Mylan.

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allege that putting the product on the market creates a misleading

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impression that the drug is FDA-approved.

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the Defendants put their products on industry “Price Lists,” and

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that “buyers believe that all prescribed drugs identified on the

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Price Lists are . . . FDA-approved.”

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alleges that by listing their drugs as “generics,” they are

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implying that their products are “equivalents” of Par’s FDA-

On the other hand, Par’s argument is more

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Par does not merely

Rather, it alleges that

(Compl. ¶ 71.)

And it

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approved product, which might mislead consumers into thinking that

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Defendants’ products are also FDA-approved.

(Id. at 70.)

3

The problem, for Par, is that when the alleged representation

4

is not an overt false statement, but merely misleading in context,

5

the evidentiary showing required to sustain a Lanham claim is

6

higher.

7

conveyed the implied message and thereby deceived a significant

8

portion of the recipients becomes critical.”

9

v. Grp. W, Inc., 66 F.3d 255, 258 (9th Cir. 1995).

In such a case, “proof that the advertising actually

William H. Morris Co.
Thus, to

10

succeed on its claims against American Regent and IMS, Par must

11

allege facts tending to show that the message “our product is FDA-

12

approved” was actually conveyed to consumers by American Regent and

13

IMS.

14

Here, Par does allege that consumers suffer actual confusion:

15

“[B]uyers believe that all prescribed drugs identified on the price

16

lists are . . .

17

yet produced actual evidence of these consumer beliefs, at the

18

motion to dismiss stage, the Court can accept allegations of such

19

facts as sufficient.

FDA-approved.”

(Compl. ¶ 71.) While Par has not

20

Par’s Lanham Act claims that its competitors are falsely

21

representing their products as having been FDA-approved are neither

22

precluded by the FDCA nor within the primary jurisdiction of the

23

FDA.

24

motion to dismiss.

25

advertise their products as FDA-approved, the motion to dismiss is

26

denied.

27

2. “Safe” and “Effective”

Plaintiff’s factual pleadings are sufficient to survive a
As to the question of whether Defendants

28
16

1

In its complaint, Par frequently alleges that the Defendants

2

misleadingly represent their products as “safe, effective, and FDA-

3

approved.”

4

Defendants’ products are “safe” or “effective” might well fall

5

within the primary jurisdiction of the FDA, or even be precluded

6

entirely.

7

Par alleges no facts to show that Defendants’ products are either

8

unsafe or ineffective.

9

well be mere rhetorical excess on Par’s part.

(E.g., Compl. ¶ 72.)

A determination of whether the

However, the Court need not decide these issues today.

The repeated inclusion of such language may
However, to the

10

extent that any of the Plaintiff’s arguments about FDA approval

11

rest on a determination of either safety or effectiveness, such

12

arguments suffer a fatal lack of factual sufficiency.

13

sole question with respect to the surviving claim against

14

Defendants is whether it overtly represents its products as being

15

“FDA-approved,” and not any question of safety or effectiveness.

16

3. Legality of the Defendants’ Products

Thus, the

17

Par further alleges that the Defendants are falsely

18

representing to consumers that their products “comply with all

19

applicable laws, including the FDCA.”7

20

least respecting Defendants Hospira and IMS, the complaint alleges

21

sufficient facts to support a finding of overt statements to this

22

effect.

(Compl. ¶¶ 60, 87.)

And at

For example, Hospira is alleged to claim on its website

23
24
7

25
26
27
28

In its Opposition, Par seems to suggest that no finding of
illegality is needed: “Par’s complaint is not based on a violation
of the FDCA; it is based on Defendants’ deceptive advertising of
their products as equivalent to Par’s.” (Opp’n § I.B.) However,
because the complaint raises allegations that the Defendants are
misleading consumers by claiming to comply with the law, the Court,
to resolve that claim, would have to make a factual finding with
regard to the alleged FDCA violations.
17

1

that its complies with “applicable laws and other requirements.”

2

(Compl. ¶ 62.)

3

However, unlike a mere determination that a drug is or is

4

not FDA-approved, the allegation that the drugs are being sold

5

unlawfully is an issue that would require a more complex finding

6

from the agency.

7

rule making it patently unlawful to market any drug without going

8

through the FDA approval process, it might not be necessary for the

9

FDA to make a specific finding regarding the Defendants’ products

Of course, if there were a clear and absolute

10

for the court to be able to determine that Defendants’ products do

11

not comply with the FDCA.

12

PhotoMedex, 601 F.3d at 924-25.

And at first blush, 21 U.S.C. § 355(a) would seem to provide

13

such a clear rule: “No person shall introduce or deliver for

14

introduction into interstate commerce any new drug, unless an

15

approval of an application filed pursuant to subsection (b) or (j)

16

of this section is effective with respect to such drug.”

17

Par admits (Opp’n, “Factual Background”), however, there are some

18

exceptions to this seemingly clear rule.

19

drugs marketed are “new,” and many older drugs, even when updated,

20

are exempt from the strictures of

21

321(p) (setting out grandfathered exceptions to the definition of

22

“new drug”); see also FDA, Compliance Policy Guide Sec. 440.100

23

Marketed New Drugs Without Approved NDAs and ANDAs, FDA.gov (Sep.

24

16 2011), available at

25

http://http://www.fda.gov/iceci/compliancemanuals/compliancepolicyg

26

uidancemanual/ucm074382.htm (discussing grandfather clauses in the

27

FDCA and a “Prescription Drug Wrap-Up” program that brought many,

28

but not all, old drugs into the fold of FDA approval).
18

As even

Specifically, not all

§ 355(a).

See 21 U.S.C. §

1

In short, unlike the binary factual determination of whether

2

Defendants’ products are, in fact, FDA-approved, the question of

3

legality directly implicates the FDA’s rulemaking authority.

4

determination of whether a drug is “new,” and whether it can be

5

lawfully marketed under the FDCA, involves complex issues of

6

history, public safety, and administrative priorities that Congress

7

has delegated exclusively to the FDA.

8
9

The

That does not mean, however, that an allegation of illegality
under the FDCA could never form the basis of a successful Lanham

10

Act claim.

11

clear, where the court is not called upon to make determinations

12

within the exclusive purview of FDA authority, a Lanham Act claim

13

may be heard, even if the subject of the claim touches the area of

14

authority of the FDCA.

15

categorical matter. If the Plaintiff were to pursue the matter with

16

the FDA through its administrative procedures and obtain a clear

17

statement from the agency that the Defendants are selling their

18

products illegally or otherwise breaking the law, and if the

19

Defendants at that point chose to affirmatively declare in their

20

advertising that their products comply with the law, a federal

21

court could hear a Lanham Act claim for false advertising.

22

As PhotoMedex and POM Wonderful both make abundantly

Thus, this claim is not precluded as a

But this Court cannot proceed on this claim without a clear

23

statement by the FDA.

24

of the FDA to decide, at least in the first instance, the legality

25

or illegality of marketing a particular substance.

26

us that FDA has power to determine whether particular drugs require

27

an approved NDA in order to be sold to the public. FDA is indeed

28

the administrative agency selected by Congress to administer the

To do so would be to arrogate the authority

19

“It is clear to

1

Act, and [it] cannot administer the Act intelligently and

2

rationally unless it has authority to determine what drugs are ‘new

3

drugs' . . . and whether they are [grandfathered].” Weinberger v.

4

Hynson, Westcott & Dunning, Inc., 412 U.S. 609, 624 (1973).

5

In short, in order to resolve Par’s Lanham Act claim based a

6

factual allegation that the Defendants are falsely claiming to

7

comply with the law while in fact selling illegal products, the

8

Court must resolve an issue that Congress has placed “within the

9

jurisdiction of an administrative body having regulatory

10

authority,” under a comprehensive regulatory scheme.

11

Corp., 828 F.2d at 1362.

12

that can be resolved without expertise.

13

decision to centralize authority to determine the legality of drug

14

sales in the FDA was obviously intended to provide “uniformity of

15

administration.”

16

claim with regard to legality requires a determination that is

17

within the primary jurisdiction of the FDA.

18

4. Misleading Labeling

Id.

Gen. Dynamics

And, crucially, this is not a question
Id.

Moreover, Congress’s

Thus, it seems clear that Par’s Lanham Act

19

Finally, Par argues that the Defendants mislead the public by

20

not including, in their packaging and labeling, all of the caveats

21

and warnings that Par’s product must carry under the terms of its

22

FDA approval.

23

Par’s product is less safe, because it comes with more warnings

24

than the Defendants’ unapproved products.

25

This, it is alleged, creates the impression that

Even if this allegation is true, Par faces several hurdles to

26

basing a Lanham Act claim on it.

First, because the deceit alleged

27

is by implication rather than an overt false statement (such as

28

“Par’s ADRENALIN is less safe than our product!”), Par has the
20

1

burden of pleading at least some facts tending to show that the

2

alleged implied message is actually transmitted to the consumer.

3

William H. Morris, 66 F.3d at 258.

4

best.

5

message about its product is actually conveyed to consumers.

6

Indeed, the message is at least ambiguous: a savvy consumer of

7

pharmaceuticals, used to many pages of dire warnings, might well be

8

put on guard by the lack of similar warnings on the Defendants’

9

products.

10

Here the pleading is thin at

Par does not allege facts tending to show that the negative

Even if Par’s pleading were sufficient to show that the

11

alleged implied message is actually transmitted to consumers,

12

however, the area of drug labeling was specifically singled out by

13

the POM Wonderful Court as being one where the FDA takes a

14

particularly active role.

15

obliquely, that drug labeling might be an area where Lanham Act

16

claims are precluded.

17

POM Wonderful suggested, at least

Par argues that because the Defendants’ products are

18

unapproved, they are effectively unregulated by the FDA.

19

I.C.)

20

situation envisioned in POM Wonderful, where the FDA would have

21

pre-approved a drug label, here Par correctly points out that the

22

FDA has taken no action at all with regard to these labels.

23

this case might not fall within POM Wonderful’s caveat-in-dictum.

24

There is, perhaps, some merit to this argument.

(Opp’n §
Unlike the

Thus,

However, the Court need not resolve this thorny issue, because

25

there is a third, truly fatal problem with Par’s allegation:

26

namely, it requires the Court to determine, as a matter of fact,

27

that Par’s ADRENALIN is not less safe than the Defendants’ various

28

products.

After all, if ADRENALIN were less safe, the implied
21

1

message would not be false or misleading; it would be correct.

2

may find it obvious that its product is not less safe than the

3

Defendants’ products, but it has not alleged any particular facts

4

tending to prove the comparative safety of the various products

5

involved.8

6

Par

Because the Plaintiff’s Lanham Act claim based on false or

7

misleading labeling requires a showing of facts not properly

8

pleaded, this claim is dismissed as to all Defendants.

9

IV. CONCLUSION

10

For all the reasons discussed above, Plaintiff’s Lanham Act

11

claim and corresponding state law claims based on false

12

representations of FDA approval survive, and the Defendants’

13

motions are denied.

14

Plaintiff’s claims based on false or misleading

15

representations that the Defendants’s products comply with the law

16

are dismissed without prejudice, so that the Plaintiff can, if it

17

wishes, file a petition with the FDA to have its competitors’

18

products declared unlawful.

19

Finally, any claims based on representations that the

20

Defendants’ products are “safe” and/or “effective” are dismissed.

21

Claims that the Defendants’ labels and packaging are misleading

22
23

///

24

///

25
26
8

27
28

Even if Par had alleged such facts, however, the safety
determination would almost certainly require the scientific
expertise of the FDA, and so would likely fall within the agency’s
primary jurisdiction.
22

1

because they imply that their products are safer than Plaintiff’s

2

are also dismissed.

3
4

The motions to dismiss are thus granted in part and denied in
part.

5
6

IT IS SO ORDERED.

7
Dated: October 7, 2014
DEAN D. PREGERSON
United States District Judge

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