Babich-Zacharias v. Bayer Healthcare Pharmaceuticals Inc.

Filing 50

MEMORANDUM OPINION AND ORDER granting in part and denying in part 42 Motion to Dismiss for Failure to State a Claim; Signed by Senior Judge Thomas B. Russell on 8/7/15: The motion filed by Defendant Bayer Healthcare Pharmaceuticals, Inc., is GRANTED IN PART and DENIED IN PART. Babich-Zacharias's breach of implied warranty claim is hereby DISMISSED. Her claims for strict liability and negligent misrepresentation may proceed. cc: Counsel (DJT)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
PADUCAH DIVISION
CIVIL ACTION NO. 5:14-CV-00101-TBR

ASHLEY BABICH-ZACHARIAS

Plaintiff,

v.
BAYER HEALTHCARE PHARMACEUTICALS, INC.,
BAYER PHARMA AG, and BAYER OY

Defendants.

MEMORANDUM OPINION AND ORDER
This matter comes before the Court upon the motion to dismiss filed by Defendant Bayer
Healthcare Pharmaceuticals, Inc. (“Bayer”). (Docket No. 42.) Plaintiff Ashley Babich-Zacharias has
responded, (Docket No. 44), and Bayer has replied, (Docket No. 46). Fully briefed, this matter stands
ripe for adjudication. For the reasons set forth below, the Court will GRANT IN PART and DENY IN
PART Bayer’s motion to dismiss.
Factual Background
Babich-Zacharias raises product liability claims arising from her use of Mirena, an intrauterine
contraceptive system produced by Bayer. The device consists of a T-shaped polyethylene frame with a
steroid reservoir that releases levonorgesterel, a synthetic hormone that acts as a contraceptive, into the
uterus each day. A healthcare provider inserts the device into the uterus during an office visit, after which
it may remain in use for up to five years.
The Amended Complaint alleges that in January 2010, Babich-Zacharias’s Mirena was inserted
by Dr. Tasheema Fair at the Baynes-Jones Army Community Hospital in Fort Polk, Louisiana. BabichZacharias claims that in April 2011, she developed severe headaches and vision problems. When her
symptoms worsened in August 2011, she sought additional treatment. She was ultimately diagnosed with
bilateral optic nerve swelling, most likely attributable to pseudotumor celebri. According to Plaintiffs,
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pseudotumor celebri, also known as idiopathic intracranial hypertension (“PTC/IIH”), occurs when fluid
builds up in the skull, triggering “severe migraines or migraine-like headaches with blurred vision,
diplopia (double vision), temporary blindness, blind spots, or other visual deficiencies” due to increased
pressure on the optic nerve. (Docket No. 40 at ¶¶ 43-44.) If not correctly diagnosed and treated, PTC/IIH
may cause permanent vision loss and blindness. (Docket No. 40 at ¶ 50.) Although the condition is
treatable, positive outcomes are not assured.
In August 2011, Babich-Zacharias underwent surgery to prevent permanent damage to her optic
nerve. On June 20, 2013, her Mirena was removed. She maintains that although the removal alleviated
the severity of her symptoms, it did not cure them; she alleges continued vision problems and migrainelike headaches. (Docket No. 40 at ¶ 188.) She submits that her injuries were caused or triggered by her
Mirena.
On March 10, 2015, Babich-Zacharias filed her Amended Complaint, asserting claims against
Bayer for negligence, design defect, failure to warn, strict liability, breach of implied and express
warranties, negligent and fraudulent misrepresentation, and fraud by suppression and concealment. She
contends that levonorgestrel “causes or contributes to the development of PTC/IIH, increases the risk of
developing PTC/IIH, and/or worsens or exacerbates PTC/IIH” and that Bayer concealed its knowledge of
these defects. (Docket No. 40 at ¶ 64.) According to Babich-Zacharias, Mirena’s label and patient
information booklet fail to warn users of this “known link” between the device and these conditions.
(Docket No. 40 at ¶¶ 39-41.) She further argues that despite medical literature reflecting a need for
additional research, Bayer failed to conduct clinical tests investigating this purported connection. (Docket
No. 40 at ¶ 42.) Finally, she points to Bayer’s “Mirena Simple Style Statements Program,” consumerdirected live presentations directed toward “busy moms.” According to Babich-Zacharias, the Simple
Style script omitted information regarding serious risks associated with using Mirena. (Docket No. 1 at ¶
164-167.)

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Legal Standard
The Federal Rules of Civil Procedure require that pleadings, including complaints, contain a
“short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P.
8(a)(2). A complaint may be attacked for failure “to state a claim upon which relief can be granted.” Fed.
R. Civ. P. 12(b)(6). When considering a Rule 12(b)(6) motion to dismiss, a court will presume that all the
factual allegations in the complaint are true and will draw all reasonable inferences in favor of the
nonmoving party. Total Benefits Planning Agency v. Anthem Blue Cross & Blue Shield, 552 F.3d 430,
434 (6th Cir. 2008) (citing Great Lakes Steel v. Deggendorf, 716 F.2d 1101, 1105 (6th Cir. 1983)). “The
court need not, however, accept unwarranted factual inferences.” Id. (citing Morgan v. Church's Fried
Chicken, 829 F.2d 10, 12 (6th Cir. 1987)).
Even though a “complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed
factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more
than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (citations
omitted). Instead, the plaintiff's “[f]actual allegations must be enough to raise a right to relief above the
speculative level on the assumption that all the allegations in the complaint are true (even if doubtful in
fact).” Id. (citations omitted). That is, a complaint must contain enough facts “to state a claim to relief that
is plausible on its face.” Id. at 570. A claim becomes plausible “when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that the defendant is liable for the misconduct
alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Twombly,
550 U.S. at 556). If, from the well-pleaded facts, the court cannot “infer more than the mere possibility of
misconduct, the complaint has alleged—but has not ‘show[n]’—‘that the pleader is entitled to relief.” ’ Id.
at 679 (quoting Fed. R. Civ. P. 8(a)(2)). “[O]nly a complaint that states a plausible claim for relief
survives a motion to dismiss.” Id.
Moreover, a plaintiff alleging negligent misrepresentation under Kentucky law must adhere to the
heightened pleading standard articulated by Federal Rule of Civil Procedure 9(b), which is “designed to
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prevent ‘fishing expeditions,’ to protect defendants’ reputations from allegations of fraud, and to narrow
potentially wide-ranging discovery to relevant matters.’” Chesbrough v. VPA, P.C., 655 F.3d 461, 4677
(6th Cir. 2011) (citing United States ex rel. SNAPP, Inc. v. Ford Motor Company, 532 F.3d 496, 504 (6th
Cir. 2008)). The Sixth Circuit has acknowledged a lack of clarity regarding the pleading standard that
applies to negligent misrepresentation claims, point to a circuit split among federal courts of appeals as to
this issue. See Republic Bank & Trust Co. v. Bear Stearns & Co., Inc., 683 F.3d 239, 247 (6th Cir. 2012).
Looking to Sixth Circuit precedent, though, Republic Bank advised that “[w]hether a state-law claim
sounds in fraud, and so triggers Rule 9(b)’s heightened standard, is a matter of substantive state law, on
which we must defer to the state courts.” Id. Because Kentucky law “holds parties pleading negligent
misrepresentation to Kentucky’s version of Rule 9(b),” a plaintiff’s negligent misrepresentation claim
must satisfy this higher standard to survive dismissal. Id. at 248. See also Morris Aviation, LLC v.
Diamond Aircraft Indus., Inc., 536 Fed. App’x 558, 562 (6th Cir. 2013) (also applying the Rule 9(b)
standard to negligent misrepresentation claims).

Analysis
Bayer now moves to dismiss Babich-Zacharias’s claims for strict liability, breach of implied
warranty, and negligent misrepresentation. The Court will address each in turn.

The Court will deny Bayer’s motion to dismiss the strict liability claim.

I.

Count IV of Babich-Zacharias’s Amended Complaint asserts a claim for strict liability, alleging
that when her Mirena device “left the hands of the manufacturer and/or supplier, it was unreasonably
dangerous, more dangerous than an ordinary consumer would expect, and more dangerous than other
contraceptives.” (Docket No. 40 at ¶ 276.) She asserts that Bayer is “strictly liable for placing an
unreasonably dangerous product on the market that [was] not safe for its intended use[.]” (Docket No. 40
at ¶ 298.)

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Bayer moves the Court to dismiss this claim, noting first that Babich-Zacharias has raised
separate claims for design defect and theory to warn. Bayer argues that to the extent that the strict
liability claim is also grounded upon these theories, it must be dismissed as duplicative. The Court,
however, disagrees. Kentucky law permits a plaintiff to advance claims for both strict liability and
negligence against a manufacturer whose product caused her injury. Waltenburg v. St. Judge Medical,
Inc., 33 F. Supp. 3d 818, 836 (W.D. Ky. 2014) (citing Ostendorf v. Clark Equip. Co., 122 S.W.3d 530,
535 (Ky. 2003)). Although “[t]he foundation of both theories is that the product is ‘unreasonably
dangerous,’” Ostendorf, 122 S.W.3d at 535, the claims are distinct. “Whereas negligence examines the
conduct of the manufacturer—could the manufacturer foresee the harm to the plaintiff and did the
manufacturer act reasonably to prevent that harm—strict liability typically evaluates the condition of the
product.” Id. Because Babich-Zacharias’s claims are not duplicative, the Court need not dismiss them at
this stage.
Bayer further moves to dismiss any portion of the claim asserting a manufacturing defect. The
Company argues that Babich-Zacharias failed to specify any manufacturing defect that deviated from
Bayer’s specifications. In response, Babich-Zacharias clarifies that she has not levied a manufacturing
defect claim. (See Docket No. 44 at 3.) Accordingly, the Court will deny as moot Bayer’s motion to
dismiss the perceived manufacturing defect claim.
II.

The Court will grant Bayer’s motion to dismiss the claim for breach of implied
warranty.

Bayer next argues that Babich-Zacharias’s claim for breach of implied warranty fails as a matter of
law, as no privity of contract existed between the parties. The Court agrees. “Under Kentucky law,
privity of contract is an essential element for breach of warranty.” Allen v. Abbott Labs., No. 11-146DLB, 2012 WL 10508 (E.D. Ky. Jan. 3, 2012). Babich-Zacharias does not contest this principle, nor does
she allege that she purchased Mirena directly from Bayer.
motion to dismiss this claim.

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Therefore, the Court will grant Bayer’s

III.

The Court will permit Babich-Zacharias’s negligent misrepresentation claim to
proceed.
Finally, the Court turns to Babich-Zacharias’s negligent misrepresentation claim. According to

Bayer, the scope of this tort does not encompass circumstances involving advertising and packaging
associated with a defective product. Bayer’s argument is not without basis. Bland v. Abbott Labs., Inc.,
addressed a negligent misrepresentation claim based on marketing and packaging materials associated
with the defendant’s product. No. 3:11-CV-430-H, 2012 WL 524473, at *1 (W.D. Ky. Feb. 16, 2012).
The Court observed that the Kentucky Supreme Court had adopted Section 552 of the Restatement
(Second) of Torts. Id. (citing Presnell Construction Managers, Inc. v. EH Construction, LLC, 134
S.W.3d 575 (Ky. 2004)). This Section provides, in pertinent part:
One who, in the course of his business, profession or employment, or in
any other transaction in which he has a pecuniary interest, supplies false
information for the guidance of others in their business transactions, is
subject to liability for pecuniary loss caused to them by their justifiable
reliance upon the information, if he fails to exercise reasonable care or
competence in obtaining or communication the information.
Giddings, 348 S.W.3d at 744-45 (quoting Restatement (Second) of Torts § 552 (1977).) Looking to
Section 252, Judge Heyburn dismissed the plaintiffs’ claim. See Bland, 2012 WL 524473, at *2 (“[T]he
true injury in [products liability cases] is ‘the failure of the product to function properly,’ not reliance on
false information.”) (quoting Giddings, 348 S.W.3d at 745)).
Despite Bayer’s reliance upon Bland and similar cases, more recent precedent reflects that a
different section of the Restatement now governs. In Morris Aviation, LLC v. Diamond Aircraft Indus.,
Inc., the Sixth Circuit pointed to Giddings’ acknowledgement of Section 9 of the Restatement (Third) of
Torts: Products Liability, which provides:
One engaged in the business of selling or otherwise distributing products
who, in connection with the sale of a product, makes a fraudulent,
negligent, or innocent misrepresentation of material fact concerning the
product is subject to liability for harm to person or property caused by
the misrepresentation.
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536 Fed. App’x 558, 567-68 (6th Cir. 2013) (quoting Giddings, 348 S.W.3d at 736 n. 11). Accordingly,
Kentucky law now provides for negligent misrepresentation claims associated with the sale of a product.
Because Section 9 applies to Babich-Zacharias’s claim, the Bland reasoning does not compel its
dismissal.
The Sixth Circuit also noted that “the negligent- and fraudulent-misrepresentation torts are
parallel, and both must relate to misrepresentations of ‘material fact.’” Id. at 568. Babich-Zacharias has
adequately alleged that Bayer made affirmative false statements with regard to Mirena. Therefore, her
claim survives Bayer’s motion. Accord Stanley v. Bayer Healthcare Pharmaceuticals, Inc., et al., No.
3:15-cv-00230-JHM, 2015 WL 4511973 at *2-3 (allowing another Mirena plaintiff’s claim to proceed for
these reasons). But see Baird v. Bayer Healthcare Pharmaceuticals, Inc., No. 6:13-077-DCR, 2013 WL
5890253 at *3-4 (E.D. Ky. Oct. 31, 2013) (relying upon Bland to dismiss a Mirena plaintiff’s negligent
misrepresentation claim).
Conclusion and Order
For the reasons set forth above, IT IS HEREBY ORDERED that the motion filed by Defendant
Bayer Healthcare Pharmaceuticals, Inc., is GRANTED IN PART and DENIED IN PART. BabichZacharias’s breach of implied warranty claim is hereby DISMISSED. Her claims for strict liability and
negligent misrepresentation may proceed.

August 7, 2015

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