Cates et al v. Stryker Corp. et al
Filing
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MEMORANDUM AND ORDER granting in part and denying in part 6 defendants' Motion to Dismiss plaintiffs' complaint. The motion is DENIED as to plaintiffs' claims for negligence, strict products liability, fraud, puniti ve damages, and loss of consortium; and GRANTED as to plaintiffs' claims for breach of express warranty, breach of implied warranty, and violation of the Tennessee Consumer Protection Act; such claims are hereby DISMISSED. Signed by District Judge Thomas W Phillips on January 27, 2012. (AYB)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE
AT KNOXVILLE
JACOB CATES and TIFFANY CATES,
Plaintiffs,
v.
STRYKER CORP., AND
STRYKER SALES CORP.,
Defendants.
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No. 3:10-CV-546
(Phillips)
MEMORANDUM AND ORDER
This is a products liability action arising from the insertion of a pain pump
allegedly manufactured, sold, and distributed by Stryker into the shoulder of plaintiff Jacob
Cates following arthroscopic shoulder surgery. Plaintiffs have asserted claims against
defendants for negligence, strict liability, breach of express warranty, breach of implied
warranty,
fraudulent
misrepresentation,
fraudulent
concealment,
negligent
misrepresentation, fraud and deceit, and violation of the Tennessee Consumer Protection
Act.
Defendants Stryker Corporation and Stryker Sales Corporation (Stryker) have
moved to dismiss plaintiffs’ complaint on the following grounds: (1) plaintiffs’ claims for
negligence and strict liability are barred by Tennessee’s one-year statute of limitations; (2)
plaintiffs’ claims for breach of express warranty and breach of implied warranty are barred
by Tennessee’s four-year statute of limitations; (3) plaintiffs’ claims for fraud fail to identify
the alleged misrepresentations or omissions with particularity as required by Rule 9(b); (4)
plaintiffs’ claim for violation of the Tennessee Consumer Protection Act is barred by the
statute of limitations; (5) plaintiffs cannot show by clear and convincing evidence that
defendants acted with the requisite level of culpability for an imposition of punitive
damages; and (6) Tiffany Cates derivative claim for loss of consortium fails as plaintiffs fail
to state any valid underlying claim.
Plaintiffs have responded in opposition to defendants’ motion asserting: (1)
their claims are tolled because of Tennessee’s discovery rule and by defendants’ fraudulent
concealment; (2) plaintiffs concede their claims for breach of express warranty and breach
of implied warranty are barred; (3) their claims for fraud are pled with sufficient specificity
to meet the liberal pleading standards under the Federal Rules of Civil Procedure; (4) their
claims for violation of the Tennessee Consumer Protection Act are not barred by the statute
of repose contained in Tenn. Code Ann. § 47-18-110; (5) their complaint shows by clear
and convincing evidence that Stryker acted with the requisite level of culpability to award
punitive damages; and (6) Tiffany Cates’ claim for loss of consortium is valid.
I. Factual Background
Plaintiff Jacob Cates underwent arthroscopic shoulder surgery on January
21, 2005. His orthopedic surgeon inserted a Stryker pain pump that injected pain relief
medication into the shoulder joint. Pain pumps are commonly used medical devices for
post-surgery pain relief in orthopedic procedures. Pain pumps work by bathing the surgical
site with a constant source of local anesthetic, delivered via a “soaker” catheter implanted
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during the surgery. Cates alleges that the delivered anesthetic is toxic to the chondral
cartilage, which is the cartilage that makes up the articular surfaces in the shoulder. Cates
further alleges that once the anesthetic kills the chondrocytes (the cells that make up the
chondral cartilage), the shoulder is irreparably damaged and the chondrocytes will not
regenerate. This progresses to a condition known as glenohumeral chondrolysis, which
results in constant pain and loss of full use of the shoulder and/or arm. There is no
effective treatment for glenohumeral chondrolysis, and many patients ultimately require
shoulder replacements.
Cates alleges that the pain pump injected the local anesthetic products into
his shoulder joint on a continuous basis for up to 72 hours or more following the surgery.
Cates claims as a result of the use of the pain pump, he has experienced and/or is at risk
of experiencing serious and dangerous side effects including but not limited to, loss of
shoulder mobility and range of motion, and loss of use of his shoulder.
II. Standard for Rule 12(b)(6) Dismissal
Rule 12(b)(6), Federal Rules of Civil Procedure, provides for dismissal of a
complaint for “failure to state a claim upon which relief can be granted.” A dismissal for
failure to state a claim is proper if it appears beyond doubt that the plaintiff can prove no
set of facts in support of his claims that would entitled him to relief. Stemler v. City of
Florence, 350 F.3d 578, 590 (6th Cir. 2003). In determining whether a motion to dismiss
should be granted, a district court must accept as true all factual allegations in the
complaint and all reasonable inferences that can be drawn from them. In re Sofamor
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Danek Group, Inc., 123 F.3d 394, 400 (6th Cir. 1997). The district court, however, need not
accept legal conclusions or immaterial factual inferences. Advocacy Org. for Patients and
Providers v. Auto Club Ins. Ass’n, 176 F.3d 315, 325 (6th Cir. 1999).
The Supreme Court clarified the pleading standard necessary to survive a
Rule 12(b)(6) motion in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), holding that
a complaint’s factual allegations must “raise a right to relief above the speculative level,”
and must contain facts sufficient to “state a claim to relief that is plausible on its face.” Id.
at 570. At the very least, dismissal under Rule 12(b)(6) is proper where the complaint lacks
an allegation regarding an element necessary to obtain relief. Mezibov v. Allen, 411 F.3d
712, 716 (6th Cir. 2005).
III. Analysis
A.
Plaintiff’s Personal Injury Claims are Timely under Tennessee’s Discovery
Rule
Tennessee Code Annotated § 28-3-104 mandates that an action “for any
injuries to the person . . . shall be commenced within one (1) year after the cause of action
accrued.” Tenn. Code Ann. § 28-3-104(a)(1). In products cases, an action for personal
injury accrues “on the date of the personal injury.” Id. at (b)(1). Cates alleges that his
injury occurred when a Stryker pain pump was inserted into his shoulder joint after
arthroscopic surgery on January 21, 2005. He filed his complaint on November 12, 2010,
nearly six years after his injury allegedly occurred. Therefore, it appears that plaintiff’s claim
would be barred by the one-year statute of limitations.
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Cates asserts, however, that Tennessee’s discovery rule tolls the statute of
limitations in this case. The court agrees. While under § 28-3-104 a case normally must
be filed within one year of injury, Tennessee law requires that a plaintiff have knowledge
of his injury before the statute of limitations clock begins to run against him. John Kohl &
Co. P.C. v. Dearborn & Ewing, 977 S.W.2d 532 (Tenn. 1998). The Tennessee Supreme
Court in Roe v. Jefferson stated the discovery rule tolls the statute of limitations until the
plaintiff discovers, or reasonably should have discovered, the occasion, the manner, and
the means by which a breach of duty occurred that produced his injuries; and the identity
of the defendant who breached the duty. Roe, 875 S.W.2d 653, 656 (Tenn. 1994). The
requirements for tolling the statute of limitations was set out in John Kohl & Co., as follows:
[T]he discovery rule is composed of two distinct elements: (1)
the plaintiff must suffer legally cognizable damage – and actual
injury – as a result of the defendant’s wrongful or negligent
conduct, and (2) the plaintiff must have known or in the
exercise of reasonable diligence should have known that his
injury was caused by the defendant’s wrongful or negligent
conduct.
John Kohl & Co., 977 S.W.2d at 532.
The discovery rule is recognized to protect those making claims “by ensuring
that the period during which . . . suit can be filed does not expire before discovery . . of the
injury.” Sherrill v.Souder, 325 S.W.3d 584 (Tenn. 2010). The discovery rule rests on the
idea that a plaintiff cannot have a tenable claim for the recovery of damages unless and
until he has been harmed. Damage claims in cases involving hidden injuries or illnesses
therefore are viewed as not accruing until the harm becomes apparent. See Shadrick v.
Coker, 963 S.W.2d 726.
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Here, Cates alleges in his complaint that he “did not discover, nor could he
have reasonably discovered by the exercise of reasonable diligence, that he had been
injured and was suffering from various injuries related to or caused by” Striker’s pain pump.
Cates continued to seek medical treatment for the pain in his shoulder and none of his
treating doctors informed him that his shoulder problems were attributable to the pain
pump. Thus, Cates did not know the causal relationship between the pain pump and his
injury such that the statute of limitations should be triggered.
Stryker’s argument that Cates should have discovered his injury based on the
“wealth of scientific information available” is unpersuasive. Stryker’s pleadings state that
“the [medical] literature notes that the cause of chondrolysis is multifactorial and the role
of pain pumps in the development of chondrolysis has not been established.” Moreover,
as recently as November 2009, the FDA issued a statement to the effect that the cause of
chondrolysis in the shoulder, even when infusion pumps are prescribed, is unknown. See
Phillippi v. Stryker Corp., 2010 WL 2650596, *2 (E.D.Cal. July 1, 2010). It is disingenuous
for Stryker to argue that the role of pain pumps in causing chondrolysis is not clear to
trained medical people, yet argue that Cates, a layperson with no medical training, should
have discovered that the use of a pain pump may have caused his continuing shoulder
problems. Further, the scientific information Stryker references is included in scientific
journals which were not reasonably available to Cates, and he cannot be held responsible
for discovering his injury based on scientific information that was not available to him.
Sharpe v. Cureton, 319 F.3d 259, 266 (6th Cir. 2003); Shadrick, 963 S.W.2d at 734.
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Cates’ complaint states that he first learned that he suffered a wrongful injury,
separate and apart from his underlying pre-existing shoulder injury, in March 2010. His
complaint filed on November 11, 2010, was within the one-year statute of limitations based
on Tennessee’s discovery rule. Accordingly, Stryker’s motion to dismiss his claims for
negligence and strict liability is DENIED.
B.
Plaintiffs’ Claims for Breach of Express Warranty and Breach of Implied
Warranty are Barred by Tennessee’s Four-Year Statute of Limitations
Stryker asserts that Cates’ claims for breach of express warranty and breach
of implied warranty should be dismissed because plaintiffs did not bring these claims within
the four-year statute of limitations set forth in Tenn. Code Ann. § 47-2-725(1). In their
response to Stryker’s motion, plaintiffs concede that their claims for breach of express
warranty and breach of implied warranty are barred. Accordingly, Stryker’s motion to
dismiss these claims is GRANTED.
C.
Plaintiffs have Sufficiently Alleged Claims for Fraud under Rule 9(b)
Stryker asserts that plaintiffs’ fraud claims should be dismissed because
plaintiffs failed to state such claims with particularity as required by Federal Rule of Civil
Procedure 9(b). Rule 9(b) provides that “[i]n all averments of fraud or mistake, the
circumstances constituting fraud or mistake shall be stated with particularity. Malice, intent,
knowledge, and other condition of mind of a person may be averred generally.” Rule 9 is
not to be read in isolation, but is to be interpreted in conjunction with Federal Rule of Civil
Procedure 8. Michaels Bldg. Co. v. Ameritrust Co. N.A., 848 F.2d 674, 679 (6th Cir. 1988).
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Rule 8 requires only “a short and plain statement of the claim” made by “simple, concise,
and direct allegations.” Id. Rule 8 is commonly understood to embody a regime of “notice
pleading” whereby technical pleading requirements are rejected in favor of an approach
designed to reach the merits of an action. United States v. Community Health Sys. Inc.,
501 F.3d 493, 503 (6th Cir. 2008). When read against the backdrop of Rule 8, it is clear that
the purpose of Rule 9 is not to reintroduce formalities to pleading, but is instead to provide
defendants with a more specific form of notice as to the particulars of their alleged
misconduct. Id. “The purpose undergirding the particularity requirement of Rule 9(b) is to
provide a defendant fair notice of the substance of a plaintiff’s claim in order that the
defendant may prepare a responsive pleading.” Michaels Bldg. Co., 848 F.2d at 679.
In complying with Rule 9(b), a plaintiff, at a minimum, must “allege the time,
place, and content of the alleged misrepresentation on which he or she relied; the
fraudulent scheme; the fraudulent intent of the defendants; and the injury resulting from the
fraud.” Coffey v. Foamex L.P., 2 F.3d 157, 161-62 (6th Cir. 1993). Each case must be
considered on its own facts to determine whether the facts, as alleged, satisfy the
underlying purposes of Rule 9(b). Especially in a case in which there has been no
discovery, courts have been reluctant to dismiss the action where the facts underlying the
claims are within the defendant’s control. Michaels Bldg. Co., 848 F.2d at 679.
Here, plaintiffs allege that Stryker possessed knowledge of an epidemiological
correlation between pain pumps and glenohumeral chondrolysis. Further, the alleged
instances of fraud are peculiarly within Stryker’s knowledge or control. There has been no
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discovery in this case. At this juncture in the proceedings, the court finds that the plaintiffs’
complaint adequately pleads the “who, what, where, when, and how of the alleged fraud
charges, and Stryker’s motion to dismiss the fraud counts (fraudulent misrepresentation,
fraudulent concealment, fraud and deceit, and negligent misrepresentation) is DENIED.
D.
Plaintiffs’ Claims under the Tennessee Consumer Protection Act are Barred
by the Five-Year Statute of Repose
The Tennessee Consumer Protection Act (TCPA) provides a private right of
action to “[a]ny person who suffers an ascertainable loss of money or property . . . as a
result of . . . an unfair or deceptive act or practice . . . . “ Tenn. Code Ann. § 47-18-109.
Any action brought under the TCPA must be commenced within one (1) year of the
plaintiff’s discovery of the unlawful act or practice, “but in no event shall an action under
§47-18-109 be brought more than five (5) years after the date of the consumer transaction
giving rise to the claim for relief.” Tenn. Code Ann. § 47-18-110. Stryker asserts that
Cates’ surgery, during which the pain pump was inserted into his shoulder, took place on
January 21, 2005. Thus, the consumer transaction giving rise to his claim must have
occurred on or before January 21, 2005. Plaintiffs filed their complaint on November 12,
2010, well over five years after the transaction allegedly giving rise to their TCPA claim
occurred. Therefore, Stryker argues that plaintiffs’ TCPA claim is barred by the five-year
statute of repose set forth in Tenn. Code Ann. § 47-18-110.
Plaintiffs respond that the statute of repose contained in Tenn. Code Ann. §
47-18-110 may be tolled by a showing of fraudulent concealment and the toll continues until
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the reasonably diligent plaintiff discovers the fraud, relying on French v. First Union
Securities, Inc., 209 F.Supp.2d 818, 826 (M.D.Tenn. 2002) and Fahrner v. S.W. Mfg. Inc.,
48 S.W.3d 141, 145 (Tenn. 2001). Plaintiffs’ reliance on French is misplaced. In French,
the District Court for the Middle District of Tennessee relied on the Supreme Court of
Tennessee’s decision in Fahrner to find that the TCPA’s statute of limitation and statute of
repose may be tolled by a showing of fraudulent concealment. French, 209 F.Supp.2d at
826. Fahrner, however, only discusses the applicability of fraudulent concealment to tolling
statutes of limitations, not its application to tolling statutes of repose. Fahrner, 48 S.W.3d
at 145-46. Therefore, the court does not find French or Fahrner dispositive on this issue.
Instead, the court finds instructive the reasoning of the Tennessee Supreme
Court in Penley v. Honda Motor Co. Ltd, where the court interpreted statutes of repose like
the TCPA’s five-year limit as “an absolute time limit within which actions must be brought”
and “characterizes the statute of repose as an outer limit or ceiling superimposed upon the
existing statute of limitations.” Penley, 31 S.W.3d 181, 184 (Tenn. 2000); see also
Roberson v. Medtronic, 494 F.Supp.2d 864, 872 (W.D.Tenn. 2007). While the Tennessee
legislature has specifically stated that particular statutes of repose are subject to tolling by
a showing of fraudulent concealment, the legislature has not provided for tolling of the
statute of repose found in the TCPA. The statute of repose states that “in no event shall
an action under § 47-18-109 be brought more than five (5) years after the date of the
consumer transaction giving rise to the claim for relief.” Tenn. Code Ann. §47-18-110
(emphasis added). The statute makes no mention of an exception for tolling the statute of
repose by a showing of fraudulent concealment.
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Moreover, in Roberson v. Medtronic Inc., the District Court for the Western
District of Tennessee granted defendant medical device manufacturer’s motion to dismiss
the plaintiffs’ TCPA claims as time barred under Tenn. Code Ann. § 47-18-110. Roberson,
494 F.Supp.2d 864, 872 (W.D.Tenn. Apr. 23, 2007). The court noted that “the Tennessee
Supreme Court has interpreted statutes of repose like § 47-18-110's five-year limit as
absolute time limits within which action must be brought.” Id. (citing Penley v. Honda motor
Co., Ltd., 31 S.W.3d 181, 184 (Tenn. 2000)). The consumer transactions giving rise to the
plaintiff’s claims in Roberson occurred on July 7, 2000 and August 16, 2000, but the
plaintiffs did not file their complaint until November 13, 2006. Accordingly, the court held
that the plaintiffs failed to assert their TCPA claim within the five-year statute of repose and
dismissed the claim. Id.
Here, Cates’ surgery, during which the pain pump was inserted into his
shoulder, took place on January 21, 2005. The consumer transaction giving rise to his
claim occurred on or before January 21, 2005. Plaintiffs filed their complaint on November
12, 2010, well over five years after the transaction allegedly giving rise to plaintiffs’ TCPA
claim occurred. Accordingly, the court finds that plaintiffs’ TCPA claim is time barred by the
five-year statute of repose set forth in Tennessee Code Ann. § 47-18-110, and is hereby
DISMISSED.
E.
Plaintiffs have Sufficiently Alleged a Claim for Punitive Damages
Stryker argues that plaintiffs’ punitive damages claim must be dismissed
because on the face of the complaint, Stryker has not acted with intentional, fraudulent,
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malicious or reckless intent. In support of its argument, Stryker avers that given the
uncertainty within the medical community regarding the causal connection between the
development of chondrolysis and the use of pain pumps, plaintiffs cannot prove that Stryker
intentionally or fraudulently misrepresented the risk, or that Stryker was aware of and
consciously disregarded the risk.
The Tennessee law on punitive damages holds that “to be entitled to an
award of punitive damages, a plaintiff must prove by clear and convincing evidence that the
defendant acted either intentionally, fraudulently, maliciously or recklessly. Hodges v. S.C.
Toof & Co., 833 S.W.2d 896, 901 (Tenn. 1992). A person “acts fraudulently when (1) the
person intentionally misrepresents an existing, material fact or produces a false impression,
in order to mislead another or to obtain an undue advantage, and (2) another is injured
because of reasonable reliance upon that representation.” Id. Further, punitive damages
“are available when . . . gross negligence . . . intervenes in any kind of action.” Woodruff
v. Nat’l Life Ins. Co., 2008 WL 1734194, *5 (E.D.Tenn. Apr. 10, 2008).
Plaintiffs’ complaint alleges the following facts: the defendants designed,
manufactured, and distributed pain pumps; their pain pumps were designed and intended
to be used with common anesthetics; the continuous injection of such medications over
time into the shoulder joint can cause serious and permanent damage to the cartilage in
the shoulder joint (a condition called chondrolysis); the defendants represented to the
public and to healthcare professionals that their pain pumps were safe and effective and
that they could be used in the shoulder joint; the defendants knew that the FDA had not
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approved their pain pumps for use in the joint space and had repeatedly rejected their
requests for permission to market the pumps; the defendants knew or should have known
that, when used with anesthetic medications in the joint space, the pumps could be toxic
to shoulder joint cartilage; the defendants did no meaningful studies to determine the
toxicity of their pain pumps to human cartilage when used with anesthetics in the joint
space; the defendants knew that the safety of their pain pumps for orthopedic and joint
space use had not been established; the defendants nevertheless actively promoted their
pain pumps for orthopedic use in the joint space, despite the FDA’s denial of permission
to market them for those indications and despite their failure to test the pumps for safety
in the joint space; and the defendants never warned the public that the safety of using pain
pumps in the joint space had never been established.
As stated previously, the court finds that plaintiffs have pleaded their fraud
claims with sufficient specificity to meet the requirements of Rule 9(c). Plaintiffs have been
afforded no discovery in this case, and the court finds the motion to dismiss their claim for
punitive damages to be premature. This is a matter more properly addressed on summary
judgment after the parties have had an opportunity to conduct discovery. Accordingly,
defendant’s motion to dismiss plaintiffs’ punitive damages claim is DENIED.
F.
Tiffany Cates’ Loss of Consortium Claim is Valid
Stryker moves to dismiss Tiffany Cates’ claim for loss of consortium on the
ground that none of plaintiffs’ underlying claims state a claim upon which relief can be
granted. For the reasons previously stated, the court finds that plaintiffs have stated valid
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claims for negligence, strict products liability, and fraud. Accordingly, defendant’s motion
to dismiss Tiffany Cates’ claim for loss of consortium is DENIED.
IV. Conclusion
For the foregoing reasons, defendants’ motion to dismiss plaintiffs’ complaint
[Doc. 6] is GRANTED in part and DENIED in part – the motion is DENIED as to plaintiffs’
claims for negligence, strict products liability, fraud, punitive damages, and loss of
consortium; and GRANTED as to plaintiffs’ claims for breach of express warranty, breach
of implied warranty, and violation of the Tennessee Consumer Protection Act; such claims
are hereby DISMISSED.
IT IS SO ORDERED.
ENTER:
s/ Thomas W. Phillips
United States District Judge
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