Naydeck v. Merck Sharp & Dohme Co.

Filing 73

MEMORANDUM OPINION AND ORDER: For the reasons stated above the Plaintiff's motion is grantedwith respect to the femur fracture allegations, and denied as to the proposed addition of punitive damages. Plaintiff is directed to take the necessary steps to sever the femur fracture allegation and seek transfer to the New Jersey MDL. (Signed by Judge John F. Keenan on 1/23/2013) Filed In Associated Cases: 1:06-md-01789-JFK-JCF, 1:10-cv-04831-JFK(ago)

Case 1:09-md-02013-PAC Document 57

Filed 09/30/10 Page 1 of 45
USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: _________________
DATE FILED: Jan. 24, 2013

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT DISTRICTYORK
UNITED STATES OF NEW COURT
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SOUTHERN DISTRICT OF NEW YORK
IN RE:
:
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FOSAMAX PRODUCTS LIABILITY LITIGATION : No. 06 MD 1789 (JFK)
In re FANNIE MAE 2008 SECURITIES
:
08 Civ. 7831 (PAC)
--------------------------------------- :
LITIGATION
:
09 MD 2013 (PAC)
This document relates to:
:
MEMORANDUM
:
Naydeck v. Merck,
:
OPINION & ORDER
:
OPINION & ORDER
No. 10 Civ. 4831 (JFK)
:
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John F. Keenan, United States District Judge:

Before the Court is Plaintiff Nancy Naydeck’s (“Naydeck” or
HONORABLE PAUL A. CROTTY, United States District Judge:
“Plaintiff”) motion to amend her Complaint to add (1) the
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allegation that Fosamax caused BACKGROUND a femur fracture,
her to suffer

and (2) a The early for punitive damages. in home financing which that
claim years of this decade saw a boom For the reasons was fueled, among
other things, by low interest rates and amend conditions. New lending instruments, such as
follow, Plaintiff’s motion to lax creditis granted as to the
subprime a femur fracture loans) and Alt-A mortgages (low-documentation
addition of mortgages (high credit riskallegation, but denied as to the loans)
kept damages claim.
punitivethe boom going. Borrowers played a role too; they took on unmanageable risks on the
assumption that the market would continue to rise and that refinancing options would always be
I.
Background
available in the future. Lending discipline was lacking in the system. Mortgage originators did
Naydeck is a 75-year-old resident of Savannah, Georgia, who
took not hold these high-risk mortgage loans. Rather In October 2008, on their books, the
Fosamax between 1998 and 2009. than carry the rising risk Naydeck
originators sold their loans fracture of mortgage market, often as securitized
suffered a spontaneous into the secondaryher left femur, but avers packages
that knowndid not know – securities (“MBSs”). MBS marketscause of the
she as mortgage-backed and was not told – the grew almost exponentially.
fracture. But then the housing bubble burst. In 2006, theNaydeck was diagnosed
Approximately one year later, demand for housing dropped abruptly
with and home prices began to fall. In light(“ONJ”), which she immediately
osteonecrosis of the jaw of the changing housing market, banks modified their
attributedpractices and became unwilling to refinance home mortgages without refinancing.
lending to Fosamax.
In her original Complaint, filed on June 21, 2010, Naydeck
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Unless otherwise indicated, all references cited as a result of using Fosamax.
alleges that she developed ONJ as “(¶ _)” or to the “Complaint” are to the Amended Complaint,
dated June 22, 2009. For purposes of this Motion, all allegations in the Amended Complaint are taken as true.

Eventually, Naydeck states, she became aware “of the growing
1

evidence that long term Fosamax use also causes spontaneous
femur fractures.”

On September 8, 2010, Naydeck filed her

Plaintiff Profile Form, which included the assertion that
Fosamax caused both her ONJ and her femur fracture, but she did
not change her Complaint.

Plaintiff now seeks to amend her

Complaint to add the allegation that she suffered a femur
fracture as a result of using Fosamax.
add a claim for punitive damages.

Naydeck also moves to

Defendant Merck (“Merck” or

“Defendant”) opposes these proposed amendments.
II.
A.

Discussion

Standard of Law

Rule 15(a)(2), which governs amendment of pleadings after
the time for amendment as of right expires, provides that leave
to amend should be freely given “when justice so requires,” Fed.
R. Civ. P. 15(a)(2).

“When a party requests leave to amend its

complaint, permission generally should be freely granted.”
Anderson News, L.L.C. v. American Media, Inc., 680 F.3d 162, 186
(2d Cir. 2012).

However, the Court retains the discretion to

deny leave “for good reason, including futility, bad faith,
undue delay, or undue prejudice to the opposing party.” McCarthy
v. Dun & Bradstreet Corp., 482 F.3d 184, 200 (2d Cir. 2007)
(citing Foman v. Davis, 371 U.S. 178, 182 (1962)); see Local
802, Associated Musicians of Greater N.Y. v. Parker Meridien

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Hotel, 145 F.3d 85, 89 (2d Cir. 1998) (the district court’s
discretion to deny a motion to amend is “broad”).
B.

Analysis

Defendant opposes the proposed amendment on the grounds
that (1) adding a femur fracture allegation is futile, because
Georgia’s statute of limitations on the proposed femur fracture
claim has run; (2) Plaintiff has failed to adequately explain
her delay; (3) Merck would be prejudiced by the amendment
because it would be forced to expend resources defending a femur
fracture claim in this Court; and (4) permitting the amendment
would run contrary to judicial efficiency goals.

Additionally,

Defendant opposes the addition of a punitive damages claim
because the Court’s summary judgment opinion issued in
connection with Secrest v. Merck, which was the fourth
bellwether trial in this MDL, precludes Plaintiff’s claim.
As an initial matter, while Plaintiff undoubtedly was
dilatory in filing this motion to amend, the Second Circuit has
held that “delay alone, without an attendant showing of bad
faith or prejudice, is an insufficient basis for denial of a
motion to amend.” See Ruotolo v. City of N.Y., 514 F.3d 184, 191
(2d Cir. 2008).
Next, even if the femur fracture allegation is barred by
the Georgia statute of limitations, the “relation back doctrine”
set forth in Rule 15(c) renders the statute of limitations
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irrelevant.

Claims asserted in an amended complaint are deemed

to have been asserted on the date of the original complaint if
“the claims arise out of the same conduct and transactions” set
out in the original pleading.” Scantek Medical, Inc. v. Sabella,
583 F. Supp. 2d 477, 489 (S.D.N.Y. 2008).

In order for a claim

to “relate back,” it must arise out of the same “conduct,
transaction, or occurrence” as the claims raised in the earlier
filing. See Fed. R. Civ. P. 15(c) (an amendment relates back to
an earlier complaint when the new claim “arose out of the
conduct, transaction, or occurrence set forth or attempted to be
set forth in the original pleading”).

The Supreme Court has

advised that in assessing whether a proposed new allegation
relates back, the pertinent inquiry is whether the original
complaint gave the defendant fair notice of the newly alleged
claims. See Baldwin County Welcome Ctr. v. Brown, 466 U.S. 147,
150 n.3 (1984).
Under this rubric, Plaintiff’s allegation that Fosamax
caused her femur fracture relates back to her original claim,
which includes allegations that Merck mishandled the
development, testing, manufacturing, labeling and marketing of
Fosamax.

In other words, Plaintiff’s femur fracture “arose out

of” the misconduct Plaintiff alleges in her original complaint.
Fed. R. Civ. P. 15(c).

Because of the relationship between

Naydeck’s femur fracture allegation and the allegations in her
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original Complaint, Merck had fair notice of the newly alleged
claims by virtue of the original complaint.
Considering the remaining factors pertinent to a motion to
amend, the Court will first address whether Merck is unduly
prejudiced by this proposed amendment.

To determine prejudice,

the Court must decide whether the amendment would “(i) require
the opponent to expend significant additional resources to
conduct discovery and prepare for trial; (ii) significantly
delay the resolution of the dispute; or (iii) prevent the
plaintiff from bringing a timely action in another
jurisdiction.” Block v. First Blood Assocs., 988 F.2d 344, 350
(2d Cir. 1993).

As evidenced by the Plaintiff Profile Form,

Merck has been aware of Plaintiff’s femur fracture for two
years, and has had access to all of the relevant medical
records.

In addition, this case has yet to go individual

discovery, so it is unlikely that the case will be delayed.
Moreover, pursuant to the JPML’s directive, the femur fracture
claim will be severed and transferred to the New Jersey MDL.

In

light of this pending transfer, Merck will not be required to
conduct additional discovery in this MDL.

Therefore, Merck

cannot establish that it will be prejudiced by the addition of a
femur fracture allegation.
Turning to Plaintiff’s request to add a demand for punitive
damages, Defendant is correct that the amendment would be futile
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in light of the Court’s summary judgment decision in Secrest.
Although Plaintiff argues that the parties should “brief the
differences” in the law between Georgia and Florida, the Court
need not require additional briefing on this matter.
of both states are unambiguous.

The laws

Under Florida law,

A defendant may be held liable for punitive damages only if
the trier of fact, based on clear and convincing evidence,
finds that the defendant was personally guilty of
intentional misconduct or gross negligence.
Fla. Stat. § 768.72(2).

Florida statute defines “gross

negligence” as “wanting in care.” Id § 768.72(2)(b).

In

Georgia,
Punitive damages may be awarded only in such tort actions
in which it is proven by clear and convincing evidence that
the defendant’s actions showed willful misconduct, malice,
fraud, wantonness, oppression, or that entire want of care
which would raise the presumption of conscious indifference
to consequences.
The punitive damage laws of Florida and Georgia mirror each
other in that both require clear and convincing evidence of
intentional misconduct or a want of care.
In two prior bellwether trials, Secrest v. Merck and Boles
v. Merck, the Court explicitly found Merck’s actions were
neither willful nor wanting in care. See In re Fosamax Prods.
Liab. Litig., 807 F. Supp. 2d 168, 187-88 (S.D.N.Y. 2011); In re
Fosamax Prods. Liab. Litig., 647 F. Supp. 2d 265, 284 (S.D.N.Y.
2009).

“No jury could reasonably find by clear and convincing

evidence that Merck’s actions rose to the level of intentional
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misconduct.

There is no evidence - let alone clear and

convincing evidence - that Merck had ‘actual knowledge’ of the
‘high probability’ that Fosamax would cause . . . ONJ.”

The

Court further found that “[n]o jury could reasonably find by
clear and convincing evidence that Merck’s actions were so
‘reckless or wanting in care that it constituted a conscious
disregard or indifference to the life, safety, or rights of
persons.’” Id.

Therefore, Plaintiff’s motion to amend her

Complaint to include punitive damages is denied as futile. See
e.g., AEP Energy Servs. Gas Holding Co. v. Bank of Am., 626 F.3d
at 726 (“Leave to amend may be denied [where] the proposed
amendment fails to state a legally cognizable claim.”); Parker
v. Columbia Pictures Indus., 204 F.3d at 339 (“[A] district
court may deny the party’s request to amend” if “the amended
portion of the complaint would fail to state a cause of
action.”).

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III. Conclusion

For the reasons stated above t Plaintifft s motion is granted
with respect to the femur fracture allegations t and denied as to
the proposed addition of punitive damages.

Plaintiff is

directed to take the necessary steps to sever the femur fracture
allegation and seek transfer to the New Jersey MDL.

SO ORDERED.
Dated:

New York t New York
January·~-1t 2013

.~t-~

v

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John F. Keenan
United States District Judge