IN RE: PET FOOD PRODUCTS LIABILITY LITIGATION

Filing 241

REPLY BRIEF to Opposition to Motion re #203 MOTION to destroy retained wheat gluten filed by CHEMNUTRA, INC.. (BRAZIL, ANTHONY)

IN RE: PET FOOD PRODUCTS LIABILITY LITIGATION

Doc. 241

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY
IN RE PET FOODS PRODUCTS LIABILITY LITIGATION
MDL DOCKET NO. 1850 Case No. 07-2867 (NHL) Judge Noel L. Hilman

CHEMNUTRA,INC.'S REPLY IN SUPPORT OF ITS MOTION TO DESTROY RETAINED WHEAT GLUTEN

Defendant ChemNutra, Inc. ("ChemNutra") hereby serves its Reply in Support of its
motion to destroy the recalled raw wheat gluten purchased from XuZhou Anything Biologic

Technological Development Co. Ltd. ("XuZhou Anying") (collectively "Wheat Gluten") that

ChemNutra is curently storing in compliance with preservation orders previously issued by this

Cour.

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Dockets.Justia.com

MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF CHEMNUTRA. INC.'S REPLY MOTION TO DESTROY ITS INVENTORY OF WHEAT GLUTEN

I. INTRODUCTION
ChemNutra, Inc. ("ChemNutra") has incured great cost and substantial burden as a result
of

having to store, since April 2007, over 430 metric tons ofraw wheat gluten inventory in three

warehouses located in Missouri, New Jersey and Pennsylvana. (See Declaration of Steven

Miler, irir 2,3, 10 and 11.) At no time since April, 2007 has any party made efforts to sample or
test ChemNutra's Wheat Gluten, other than the FDA. The FDA's sampling and testing, the
results of

which are publically available and were attached to ChemNutra's moving papers, were

the result of reliable, independent and valid sampling and testing. The FDA has requested that
ChemNutra destroy its Wheat Gluten for public health and safety concerns and has agreed, upon

entry of an order by ths Cour, to make FDA employees available to assist in the destruction of
the Wheat Gluten. Plaintiffs fail to provide any good cause to justify the continued storage of
ChemNutra's Wheat Gluten and this Cour should order its immediate destruction.
In the alternative, if

this Cour does not authorize the full destruction ofChemNutra's

Wheat Gluten, ChemNutra requests that this Cour authorize the destruction of its Wheat Gluten
except for those bags which have been opened, sampled and tested by the FDA.
Alternatively, if

the opened bags sampled and tested by the FDA is found insufficient by

this Cour or plaintiffs, ChemNutra requests that plaintiffs take custody and control of any

additional Wheat Gluten bags which they consider necessary for potential futue sampling and
testing and that this Cour order plaintiffs to pay all costs associated with storage of these
additional bags.

Good cause supports this cost shifting burden. First, the FDA has already obtained samples and tested ChemNutra's Wheat Gluten. The FDA's sampling and tests resulted in
reliable, independent and valid results, all of

which are publicly available from the FDA and

were attached to ChemNutra's moving papers. ChemNutra has agreed to retain at its cost, if

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necessary, these opened bags for any further testing by plaintiffs or any other pary. Requiring
ChemNutra to retain over 430 metric tons of Wheat Gluten is excessive "of that typically
necessary for evidentiary purose." (See Letter from Department of Health and Human Services

regarding ChemNutra's curently stored Wheat Gluten, Exhibit C to Brazil Dec.)

Second, since the recall ofChemNutra's Wheat Gluten (over 1 ~ years) no effort or
request bv plaintiffs or any other pary has been made to sample or test ChemNutra's Wheat
Gluten. (See Declaration of

Karen Firstenberg ("Firstenberg Dec."), ir 2) It is this continued

delay in requesting testing of ChemNutra's Wheat Gluten that has caused ChemNutra's financial

burden and hardship. Plaintiffs had ample opportunity to sample and test ChemNutra's Wheat
Gluten, but have not done so. Requiring ChemNutra to continue, at its expense, to store the

Wheat Gluten for an undetermined futue amount of time, which plaintiffs equally could do,
lacks justification.

Third, the Wheat Gluten stored by ChemNutra is not the food ingested by the pets and

therefore is not the relevant Wheat Gluten which should be tested to establish causation, if any,

to plaintiffs' pets. The key issue is whether the pet food ingested was contaminated since the

Wheat Gluten was but one of many ingredients in the finished product. Thus it is the testing of

the pet food, rather than one small ingredient (ie Wheat Gluten) that wil determine liabilty.
Finally, the FDA has requested that ChemNutra destroy its Wheat Gluten and has

affrmatively agreed to make itself available upon entry of an order by this Cour for the
destruction of ChemNutra's Wheat Gluten. (See Declaration of Anthony Brazil, irir 2 and 4;

Firstenberg Dec., Exhibit A). The FDA's pubic safety concerns far outweigh any justifications
plaintiffs have prof erred to justify retention of

the Wheat Gluten.

For these reasons, ChemNutra requests that this motion be granted. Alternatively, if

this

Cour orders the continued retention ofChemNutra's Wheat Gluten, ChemNutra requests that
this Court order the costs to be shifted to plaintiffs as the financial burden of continued retention
by ChemNutra is enormous and ChemNutra has no desire or interest in retaining the materiaL.

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II. GOOD CAUSE SUPPORTS THE DESTRUCTION OF CHEMNUTRA'S
WHEAT GLUTEN
Good cause supports the destruction of ChemNutra's Wheat Gluten and plaintiffs have failed

to provide any justification to oppose this request, over i ~ years after this Cour's initial
preservation order.

The Manual for Complex Litigation is instructive, noting that a "blanet preservation order

may be prohibitively expensive and unduly burdensome" and suggesting that after reasonable

notice "(alny preservation order should ordinarily permit destruction. . ." Manualfor Complex
Litigation (4th) § 11.442 (Preservation).

Plaintiffs in their opposition argue that complete destruction would prevent "interested

paries" (opposition p.3) from futue testing and that the "urgency" ofChemNutra's request is
not appropriate under the circumstances of anticipated settlement (opposition, pg. 6). Plaintiffs
have had over 1 ~ years to test ChemNutra's Wheat Gluten and have never requested or even

suggested a need for such testing. Plaintiffs, even in its opposition, do not even assert this need plaintiffs state only that "if they so chose" plaintiffs should be able to test the Wheat Gluten

(opposition, pg. 4). Yet, plaintiffs have had such a chose for over 1 ~ years and have never
made any effort to sample or test the Wheat Gluten. The urgency, as clearly demonstrated in
ChemNutra's moving papers is the great expense ChemNutra continues to incur as a result of

storing its Wheat Gluten in three warehouses located in three states. (Miler, irir 2,3, 10 and 1 I)
This burden is unjustifiable in light ofthe FDA's testing, the results of

which are publically

available. This Cour should grant ChemNutra's request in its entirety and order the full
destruction of its Wheat Gluten.

III. CHEMNUTRA WILL RETAIN THE SAMPLE TESTING CONDUCTED BY
THE FDA
If

this Cour is not inclined to order the full destruction ofChemNutra's Wheat Gluten,

ChemNutra requests, in the alternative, that this Cour allow ChemNutra to retain only the Wheat
Gluten bags which have been opened, sampled and tested by the FDA. The Manual for Complex
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Litigation, supra, detailing preservation provides guidance. The manual states that any
"preservation order should ordinarily permit destruction after reasonable notice. . . The order
may. . . exclude specified categories. . . whose cost of preservation outweighs substantially their

relevance in this litigation. . . paricularly. . . if there are alternative sources for the information.
Manualfor Complex Litgation (4th) § 11.442 (emphasis added).
Here, retaining only the Wheat Gluten which has already been opened, sampled and

tested by the FDA provides sampling for futue testing and access to data and information which
has already been recorded and published by the FDA. This compromise allows ChemNutra to
minimize its costs while preserving, at plaintiffs' request, Wheat Gluten for futue sampling and

testing, if necessar. ChemN utra agrees to incur these costs, if necessary.

iv. IN THE ALTERNATIV. CHEMNUTRA REOUESTS THAT PLAINTIFFS

TAK CUSTODY AND CONTROL OF ITS WHEAT GLUTEN AND BE
ORDERED TO PAY THE COSTS FOR CONTINUED STORAGE OF ITS

WHEAT GLUTEN
ChemNutra, in the alternative, requests that if plaintiffs contend that the Wheat Gluten

tested by the FDA is an insufficient sampling for futue testing, that plaintiffs take custody and

control of any Wheat Gluten plaintiffs deem necessar for futue sampling and testing and that this Cour order plaintiffs to incur the futue storage expenses.
While the general presumption in discovery is that the responding par must bear the
expenses of complying with discovery requests, if responding pary asks the cour for an order

protecting it from "undue burden or expense" the cour may shift the costs to the non _

producing pary. Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 358 (1978); Fed. R. Civ. P.
26(c); see also Rowe Entm 't v. The Willam Morris Agency, Inc., 205 F.R.D. 421 (S.D. N.Y.

2002)(finding that cours have ample power under Rule 26 to protect respondent against undue
burden or expense either by restricting discovery or requiring that the discovery pary pay costs).
In analyzing a request to shift - costs, courts have conducting balancing tests of various
factors including: (1) the likelihood of discovering critical information; (2) availability of such

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information from other sources; (3) the amount in controversy as compared to the total cost of
production; (4) the parties' resources as compared to the total cost of

production; (5) the relative

abilty of each party to control costs and its incentive to do so; (6) the importance of

the issue at

stake in the litigation; (7) the importance of the requested discovery in resolving the issues at

stake in the litigation; and (8) the relative benefit to the paries of obtaining the information.
Wiginton v. CB Richard Ells, Inc., 229 F.RD. 568 (N.D. IlL., 2004); see also Zubulake v. UBS

Warburg LLC, 217 F.R.D. 309 (S.D.N.Y., 2003); Rowe Entertainment, Inc. v. Willam Morris

Agency, Inc., 205 F.RD. 421 (S.D. N.Y., 2002).

The Supreme Cour was instructive in Oppenheimer Fund v. Sanders, 437 U.S. 340

(1978). In Oppenheimer, defendants sought to reverse a cour order compelling defendants to
incur the costs of producing evidence to plaintiffs, the costs and burden of which would have

been equal for both paries and which benefited only plaintiffs. The Supreme Cour held that
where good cause supports the shifting of costs, such a shift should be ordered. The Supreme

Cour found that the costs would be equal to both paries and that the benefit flowed only to
plaintiffs and that this justified the shifting of costs to the plaintiffs. Id at 353,357,359. see
also Linder v. Calero Porto

carrero, 31 F. Supp.2d 134 (D.D.C., 1998)(ordered cost - shifting to

plaintiff, despite minimal financial means, as a means of deterring the requesting pary from
engaging in fishing expeditions for marginally relevant material)

Here, like in Oppenheimer and in balancing factors to assess whether to shift costs, good

cause supports ChemNutra's request to shift the burden of costs associated with continued
storage of its Wheat Gluten.

First, the FDA has already obtained samples and tested ChemNutra's Wheat Gluten.
ChemNutra is not aware of

anyone who contests the FDA's findings. The FDA's sampling and

tests resulted in reliable, independent and valid results, all of which are publicly available from

the FDA and were attached to ChemNutra's moving papers. Thus, there exists the requested
information from other sources, i.e. the FDA's final report. Plaintiffs have failed to provide any

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justification why the extensive sampling, testing and final results of

the FDA are not reliable and

sufficient for any future need.

The only argument presented by plaintiffs to oppose this position is the assertion that the

FDA's testing is inconsistent with previous sampling orders issued by this Cour for defendants
Menu and Del Monte. This Cour's previous order to allow destruction of all but a limited
sample of

Menu and Del Monte's wheat gluten are distinguished because the sampling

agreement that was the basis for that order were never implemented due to the enormous burden

and expense associated with implementing that order. Even more important, testing was never
conducted on any of

Menu or Del Monte's wheat gluten. This is drastically different from

ChemNutra's Wheat Gluten since sampling and testing has been conducted by the FDA, the
results of

which are publicly available and provide detailed results. Specifically, the FDA's final

report consists of 134 pages (See Exhibit 2 to Firstenberg Dec.) the FDA was methodical in

documenting its sampling and testing procedures. These test reports contain, inter alia, the
following information: (a) the date of

collection; (b) product code; (c) PIS sample number; (d)

hours spent related to each sampling; (e) country of origin for each sample; (f) a product
description; (g) batch identification; (h) reason for each sampling; (i) lot size; G) description of
sample; (k) method of collection; (1) preparation procedures for each sampling; (m) remarks; and

(n) lab conclusions. See Firstenberg, ir 3; Exhibit 2 to Firstenberg Dec. Plaintiffs have
presented no evidence to dispute the adequacy of this testing.

Second, since the recall ofChemNutra's Wheat Gluten in April, 2007, no pary has made
any effort to sample or test ChemNutra's Wheat Gluten. Significant time has passed. Plaintiffs'
delay in conducting any sampling or testing has resulted in ChemNutra incuring great expense
and hardship, including the on - going costs that ChemNutra has been compelled to undertake in
paying to store its Wheat Gluten at three storage facilities located in New Jersey, Pennsylvania

and Missouri. (Miler, irir 2, 3, 10 and 11) There is no explanation for this delay nor is their any
justification why ChemNutra should continue to incur expenses as a result of

plaintiffs' own

delay. Significantly, plaintiffs' opposition fails to even confirm their request or need for such
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testing - only that plaintiffs wish to preserve such right. Plaintiffs have had such right and their
delay should not be justification for ChemNutra's continued burden and expense.

Third, plaintiffs have failed to justify the continued retention of ChemNutra's Wheat
Gluten, paricularly in light of

the fact that the plaintiffs' pets were injured from ingesting the

finished product (ie pet food) which mayor may not have contained Wheat Gluten supplied by
ChemNutra. More importantly, the key issue in the case is not whether ChemNutra's Wheat
Gluten was contaminated but rather whether the per food ingested by plaintiffs pets was
contaminated. To resolve that issue the plaintiffs need to test the finished product not the raw
Wheat Gluten. In addition, no portion of the batch of

the Wheat Gluten stored by ChemNutra at

the Steven Shanon Warehouse in Bloomsburg, Pennsylvania was ever sold, distributed and

supplied to any person or entity the estimated 72 metric tons of Wheat Gluten. Miler, ir 7.
Therefore no pets would have been exposed to food containing wheat gluten from this warehouse
and continued storage of

this wheat gluten lacks any justification since it would not establish

causation to plaintiffs' claims.
Fourth, as par of the FDA's active investigation related to ChemNutra's recall of

its

Wheat Gluten, the FDA specifically informed ChemNutra by letter that ChemNutra should not
continue to store its Wheat Gluten for fear of

public safety. Specifically, on or about June 29,

2007, the FDA sent to ChemNutra a letter expressing its concerns regarding the "public health
risks" associated with ChemNutra's storing of their approximately 430 metric tons of

wheat

gluten. The FDA stated that "until the product is destroyed, there is a risk of reintroduction into
interstate commerce, whether intentional or not, and/or risk of expert." The FDA then urged

ChemNutra to "seek whatever relief is appropriate from the Cour." Miler, ir 8; see also Exhibit
A to Miler Dec. (emphasis added). After being informed of

plaintiffs' opposition to this motion,

the FDA has reiterated this request and has agreed to make its field agents available to oversee

ChemNutra's destruction, upon entry of an order from this Cour. Exhibit itA" to Firstenberg
Dec.

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ChemNutra seeks to follow the FDA's sowid advice. Since ChemNutra's Wheat Gluten

has been appropriately sampled, well tested and documented, good cause now support the
destrction ofChemNu1ra's Wbeat Gluten and its Motion should be granted. Both the FDA and
the US Attorneys offce have approved of

this request for destruction by ChemNutr. Brazil,

'~5, 6. Other tha telling the Cour that ChemNutr should wait the plaintiff have offered no
valid reason to force ChemNutr to incur the enormous costs associated with continuing to store
the Wheat Gluten. Furermore, the plaintiffs' justification for retention of the Wheat Gluten is

far outweighed by the public safety concerns that the FDA has expressed by the continued
storage of this Wheat Gluten.

V. CONCLUSION
ChemNutra respectfully requests tht this Court issue an Order allowing ChemNutra to
destroy its XuZhou Anying Wheat Gluten in accordace with and under the supervision of

the

FDA. In the alternative, ChemNutr requests that this Cour order the destrction ofits Wheat
Gluten except for those bags which have been opened, sapled and tested by the FDA. In the
alternative, ChemNuta requests tht if

the FDA's sampling and testing lots is insuffcient for

either this Cour or plaintiffs, that plaintiffs tae custody and control of its Wheat Gluten and that
this Cour shift the burden of costs to plaintiffs for continued storage.
DA TED: September13 2008

MORRIS POLICH & PURDY LLP

. T ONYG. BRA ,ES .
KAREN M. FIRSTEN ERG, ESQ.
1055 W. Seventh Stret, 24th Floor

Los Angeles, CA 90017
Telephone: [phone] Facsimile: (213) 488-1 178

EmaH: abrail(ßmpv1aw.com

ldėrsstenberg(gmplaw.com Counsel for Defendant CHEMNTRA INC.
ChemNutr_ ._Reply _In_support_oCrnt:"to _destroLCL0140424) (I).DOC 9