Supreme Court of the United States

Transcription

1 No IN THE Supreme Court of the United States October Term, 2017 Alice IVERS, v. Petitioner, WESTERLY PHARMACEUTICAL, INC., Respondent. On Writ of Certiorari to the United States Court of Appeals for the Twelfth Circuit BRIEF FOR RESPONDENT Attorneys for Respondent Team 2625

2 QUESTIONS PRESENTED I. Whether Petitioner s state law claims are preempted by the Hatch-Waxman Act under the Supreme Court s decisions in PLIVA v. Mensing and Mutual Pharmaceutical v. Bartlett when there is a conflict between the state law imposing a duty on Westerly to update its drug label and the federal law forbidding Westerly from unilaterally updating its drug label. II. Whether attorney s fees are included under the Federal Rules of Civil Procedure Rule 41(d) as awardable costs when the party has voluntarily dismissed their complaint and subsequently refiled the same complaint in another jurisdiction. i

3 TABLE OF CONTENTS QUESTIONS PRESENTED... i TABLE OF CONTENTS... ii TABLE OF AUTHORITIES... iv OPINIONS BELOW... 1 CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED... 1 STATEMENT OF THE CASE... 1 SUMMARY OF THE ARGUMENT... 6 ARGUMENT... 8 I. STANDARD OF REVIEW... 8 II. THE TWELFTH CIRCUIT CORRECTLY HELD THAT PETITIONER S STATE LAW CLAIMS WERE PREEMPTED BY CONFLICT PREEMPTION... 9 A. THE FEDERAL LAW THAT PREEMPTS PETITIONER S STATE LAW CLAIMS IS THE HATCH-WAXMAN ACT B. PETITIONER S STATE LAW CLAIMS ARE PREEMPTED BY THE HATCH-WAXMAN ACT DUE TO IMPOSSIBLITY PREEMPTION Westerly Was Under No Duty to Comply with State Products Liability Labeling Laws at The Time Petitioner Purchased Ropidope Westerly Was Under No Duty to Comply with IPLA at The Time GlaxoCline updated its Drug Labels for Ropidope...15 C. PETITIONER S STATE LAW CLAIMS ARE PREEMPTED BY THE HATCH-WAXMAN ACT DUE TO OBSTACLE PREEMPTION III. THE TWELFTH CIRCUIT CORRECTLY HELD THAT THE AWARDABLE "COSTS" CONSIDERED BY RULE 41(d) INCUDE ATTORNEY S FEES. 21 ii

4 A. A COURT MAY AWARD ATTORNEY S FEES AS "COSTS" UNDER RULE 41(d) WHEN THE UNDERYLYING STATUTE ALLOWS FOR AWARD OF ATTORNEY S FEES B. AWARDING ATTORNEY S FEES AS "COSTS" UNDER RULE 41(d) FURTHERS THE RULE S PURPOSE OF DETERING VEXTIOUS LITIGATION AND FORUM SHOPPING CONCLUSION APPENDIX A... A-1 APPENDIX B... B-1 APPENDIX C... C-1 APPENDIX D... D-1 iii

5 TABLE OF AUTHORITIES Page(s) Cases Alyeska Pipeline Serv. Co. v. Wilderness Soc y, 421 U.S. 240 (1975)...23 Andrews v. America s Living Ctrs., LLC., 827 F.3d 306 (4th Cir. 2016)...passim Ashcroft v. Iqbal, 556 U.S. 662 (2009)...9 Davis v. USX Corp., 819 F.2d 1270 (4th Cir. 1987)...25 Duffy v. Ford Motor Co., 218 F.3d 623 (6th Cir. 2000)...26 Esposito v. Piatrowski, 223 F.3d 497 (7th Cir. 2000)...23, 24, 28 Esquivel v. Arau, 913 F. Supp (C.D. Cal. 1996)...22 Evans v. Safeway Stores, Inc., 623 F.2d 121 (8th Cir. 1980)...27 F.D. Rich Co., Inc. v. United States ex rel. Indus. Lumber Co., 417 U.S. 116 (1974)...28 Freightliner Corp. v. Myrick, 514 U.S. 280 (1995)...9 Geier v. Am. Honda Motor Co., 529 U.S. 861 (2000)...9, 21 Gibbons v. Ogden, 22 U.S. 1 (1824)...9 Hines v. Davidowitz, 312 U.S. 52 (1941)...10 iv

6 Howell v. Howell, 137 S.Ct (2017)...18 Hughes v. Talen Energy Mktg., LLC, 136 S.Ct (2016)...18 Jones v. Rath Packing Co., 430 U.S. 519 (1977)...9 Key Tronic Corp. v. United States, 511 U.S. 809 (1994)...23, 26 LeBlang Motors Ltd. v. Subaru of America, Inc., 148 F.3d 680 (7th Cir. 1998)...24 Marek v. Chesny, 473 U.S. 1 (1985)...22, 23, 24 Meredith v. Stovall, 2000 U.S. App. LEXIS (10th Cir. 2000)...27 Morris v. Pliva, Inc., 713 F.3d 774 (5th Cir. 2013)...15, 28 Mutual Pharmaceutical Co., Inc. v. Bartlett, 133 S.Ct (2013)...passim Oneok, Inc. v. Learjet, Inc., 135 S.Ct (2015)...10 PLIVA v. Mensing, 564 U.S. 604 (2011)...passim Rice v. Santa Fe Elevator Corp., 331 U.S. 218 (1947)...10 Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868 (6th Cir. 2000)...22, 25 Sanderson v. Spectrum Labs, Inc., 2000 U.S. App. LEXIS (7th Cir. 2000)...28 v

7 Sanchez v. United States DOE, 2017 U.S. App. LEXIS (10th Cir. 2017)...8 Seipel v. Bank of Am., N.A., 239 F.R.D. 558 (E.D. Mo. 2006)...22 Simeone v. First Bank Nat l Ass n, 971 F.2d. 103 (8th Cir. 1992)...22 Wyeth v. Levine, 555 U.S. 555 (2009)...20, 21 Statutes U.S. Const. art. VI, U.S.C. 355(j) (2012)...10, 11, 15, C.F.R (b)(10) C.F.R (b)(2)(i)...11 Rules Fed. R. Civ. P. 41(d)...21, 22 vi

8 OPINIONS BELOW The unreported opinion of the United States Court of Appeals for the Twelfth Circuit appears on pages 9 22 of the record. The unreported opinion of the United States District Court of Illinoza appears on pages 1 8 of the record. CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED The state statute at issue, the Illinoza Products Liability Act, is included in Appendix A. The federal statute at issue, the Hatch-Waxman Act, is included in Appendix B. The constitutional provision at issue, the Supremacy Clause, is included in Appendix C. The Federal Rule of Civil Procedure at issue, Rule 41(d), is included in Appendix D. STATEMENT OF THE CASE This case involves a dispute over whether claims under the Illinoza Products Liability Act ( IPLA ) are preempted by federal law and whether the provision awarding costs under Rule 41(d) includes attorney s fees. Brief History of Ropidope Hydrochloride In 1997, GlaxoCline, LLC ( GlaxoCline ) patented a prescription drug called ropidope hydrochloride ( ropidope ). (R. at 1-2.) That same year, they received approval from the Federal Food & Drug Administration ( FDA ) to market ropidope, a drug they sold using the brand name Equip. (R. at 2.) Once GlaxoCline s patent term expired in 2008, Westerly Pharmaceuticals, Inc. ( Westerly ) sought approval 1

9 from the FDA to sell a generic version of the drug. (R. at 2.) They did so by submitting an Abbreviated New Drug Application ( ANDA ). (R. at 2.) In the ANDA, Westerly was required to submit proof that the labeling of ropidope was identical to the labeling of Equip at the time they applied. (R. at 2.) Three years later, in January 2011, GlaxoCline sought to update the packaging label and insert of Equip by submitting a Supplemental New Drug Application ( snda ) to the FDA. (R. at 2.) The labeling change provided warnings of potential side effects of the drug, including intense urges to gamble, increased sexual urges, intense urges to spend money, binge or compulsive eating, and/or other intense urges, and the inability to control these urges. (R. at 2.) The FDA subsequently approved this request for the labeling change and five months later, in June 2011, GlaxoCline began to implement the change on its Equip labels. (R. at 2.) Only six months after GlaxoCline implemented its labeling change, in January of 2012, Westerly followed suit. (R. at 2.) Westerly submitted a notification, called a Changes Being Effected ( CBE ), to the FDA to notify them that they would also be updating the labels on their generic version of ropidope. (R. at 3.) Their new labeling would match the updates GlaxoCline had implemented only half a year ago. (R. at 3.) Westerly correctly anticipated that the changes to their labels would go into effect on February 1, 2012, merely one month after submitting the CBE application. (R. at 3.) 2

10 Alleged Liability by Plaintiff against Westerly for Failure to Update its Labels In February 2011, Plaintiff was diagnosed with Parkinson s disease. (R. at 1.) Subsequently, she received a prescription from her doctor for ropidope. (R. at 1.) Plaintiff elected to purchase the generic form of ropidope manufactured by Westerly. (R. at 1.) She began taking the drug daily in March 2011, before either GlaxoCline or Westerly had implemented the updates to their labels. (R. at 1 2.) Five months after taking ropidope, in July 2011, Plaintiff noted that she began to experience some side effects of the drug. (R. at 3.) Namely, Plaintiff states that she was compulsively spending and gambling her retirement money. (R. at 3.) For nearly a year and a half, Plaintiff gambled and won substantial sums of money. (R. at 3.) She ultimately decided to donate some of it and to use the rest on antique auctions. (R. at 3.) Although Plaintiff had won a significant amount from gambling, by the end of 2012, the entirety of the money in Plaintiff s retirement account was gone. (R. at 3.) In the Complaint, Plaintiff alleged that Westerly is liable for the result of her gambling and spending habits. (R. at 3.) Plaintiff states that, although neither GlaxoCline nor Westerly had updated their labels to include impulse control warnings when Plaintiff started taking ropidope, Westerly breached their duty to Plaintiff by providing drug labels that contained inadequate warnings and were defectively designed. (R. at 3.) Furthermore, Plaintiff claims that, even though Westerly did update their labels on February 1, 2012, Plaintiff s financial loss that 3

11 occurred at the end of 2012 was a result of inadequate warnings of the side effects of ropidope. (R. at 3.) Procedural History Plaintiff initially filed a complaint against Westerly on January 15, 2013 in the United States District Court for the Western District of East Texas. (R. at 5.) In the complaint, Plaintiff alleged the same facts and legal theories under the East Texas Products Liability Law. (R. at 5.) On February 14, 2013, the Fifth Circuit, which includes Texas, held that the Federal Food, Drug & Cosmetic Act ( FDCA ) preempted a failure to update claim very similar to that of Petitioner s, as both claims were against generic drug manufacturers. (R. at 5.) Not even two weeks after the decision was issued, on February 25, 2013, Plaintiff filed a Notice of Voluntary Dismissal. (R. at 5.) Two years after voluntarily dismissing the complaint in Texas, Plaintiff filed the Complaint against Westerly in the state court of Illinoza on September 15, (R. at 1.) Plaintiff alleged that Westerly breached its duty under sections 1(b) and 1(c) of the Illinoza Products Liability Act. (R. at 3.) On October 14, 2015, Westerly removed the action to the United States District Court for the District of Illinoza. (R. at 1.) About a month later, on November 2, 2015, Westerly filed an answer to the Complaint, a Motion for Judgment on the Pleadings, and a Motion for Award of Costs. (R. at 3.) On December 20, 2015, the District Court granted Westerly s Motion for Judgment on the Pleadings. (R. at 11.) The District Court held that both the FDCA 4

12 and the regulations of the FDA preempted Plaintiff s theory of liability. (R. at 11.) Thus, the District Court dismissed Plaintiff s complaint. (R. at 11.) The District Court then granted Westerly s motion for an award of costs, in part. (R. at 11.) Plaintiff was ordered to pay Westerly $ in costs. (R. at 11.) However, the District Court denied Westerly s [sic] request for $3,442 in attorney s fees. (R. at 11.) On January 14, 2016, Plaintiff filed a notice of appeal to the United States Court of Appeals for the Twelfth Circuit. (R. at 11.) Plaintiff contested the District Court s decision to dismiss Plaintiff s complaint and to award Westerly $ in costs. (R. at 11.) One day later, on January 15, 2016, Westerly filed a cross appeal to contest the District Court s decision to deny the request for attorney s fees. (R. at 11.) On February 2, 2017, The Twelfth Circuit affirmed the District Court s decision to dismiss Petitioner s complaint because it was preempted by federal law. (R. at 18.) Furthermore, the Twelfth Circuit affirmed the District Court s order awarding $ in costs to Westerly. (R. at 18.) However, the Twelfth Circuit reversed and remanded the part of the order that denied awarding Westerly the $3,442 in attorney s fees. (R. at 18.) This Court granted certiorari on July 17, 2017 and limited the review to two issues: (1) whether this Court s decisions in PLIVA v. Mensing, 564 U.S. 604 (2011), and Mutual Pharmaceutical v. Bartlett, 133 S.Ct (2013), preempt the Petitioner s claims; and (2) whether attorney s fees are considered awardable costs under the Federal Rule of Civil Procedure 41(d). (R. at 23.) 5

13 SUMMARY OF THE ARGUMENT I. Petitioner s state law claims conflict with the Hatch-Waxman Act and are thus preempted due to conflict preemption. Petitioner s state law claims impose a labeling duty that directly conflicts with the labeling requirements of the Hatch-Waxman Act. The fundamental legal principle that federal laws are supreme to state laws was established by the Supremacy Clause of the U.S. Constitution. When there are conflicting state and federal laws, the federal law will supersede, or preempt, the state law. The form of preemption at issue in this case is conflict preemption. Conflict preemption arises when there is a federal and state law that directly conflict with each other. In order to establish conflict preemption, either impossibility preemption or obstacle preemption must be found. Impossibility preemption occurs when complying with both the federal and state laws is impossible. Obstacle preemption occurs when complying with the state law would create an obstacle to achieving the purpose of the federal law. Petitioner s claims are preempted by both impossibility preemption and obstacle preemption. IPLA requires that drug manufacturers, regardless of whether they are branded or generic manufacturers, update their drug labels to provide an adequate warning of the drug s possible side effects. The federal law at issue, the Hatch-Waxman Act, requires the labeling of generic drugs must match that of the branded drug during generic drug approval. Mensing and Bartlett held that it is impossible for a generic company to comply with state tort law duties to update their labels because the Hatch-Waxman Act forbids them from acting unilaterally to change their labeling. Furthermore, even if the Court does not find impossibility preemption, Petitioner s claims are preempted due to obstacle 6

14 preemption. The purpose of the Hatch-Waxman Act is to facilitate the approval and marketing of generic drugs. A state tort law such as IPLA frustrates the goals of the Hatch- Waxman Act by creating additional obstacles to selling generic drugs. Therefore, this Court should uphold the Twelfth Circuit s decision that Petitioner s state law claims are preempted by federal law. II. Attorney s fees are included as awardable costs under Rule 41(d) of the Federal Rules of Civil Procedure. Attorney s fees are included under Rule 41(d) of the Federal Rules of Civil Procedure as awardable costs in accordance with the purpose of the Rule and its interpretation by the courts. The language of Rule 41(d) does not expressly define costs. Thus, courts have interpreted this ambiguity of the definition to include attorney s fees when such an award would contribute to the Rule s purpose of deterring vexatious litigation and forum shopping. Of the Federal Circuit Courts to address this issue, the Fourth, Seventh, Eighth, and Tenth Circuits have allowed attorney s fees to be awarded as costs under Rule 41(d). These courts have reasoned that it was the intent of the drafters of the Federal Rules of Civil Procedure to leave Rule 41(d) purposefully vague. Thus, the courts have concluded that such vagueness implies that attorney s fees may be awarded as costs under Rule 41(d) so long as the underlying statute permits it. Courts have also reasoned that attorney s fees may be awarded as costs in order to support the purpose of Rule 41(d) to deter vexatious litigation and forum shopping. The Fourth and Seventh Circuits have stated that a party s bad faith act 7

15 of forum shopping is reason enough to allow attorney s fees as costs for the opposing party. This case similarly presents a scenario in which an award of attorney s fees as costs under Rule 41(d) facilitates the purpose of the Rule as explained by the courts. Therefore, this Court should uphold the Twelfth Circuit s decision that attorney s fees are awardable costs under Rule 41(d). ARGUMENT This Court should affirm the Twelfth Circuit s ruling affirming the District Court s dismissal of the Complaint due to conflict preemption and the District Court s order awarding costs, but reversing the District Court s holding that denied attorney s fees for Westerly. The Twelfth Circuit correctly found that Petitioner s state law claims against Westerly for failure to update their labeling are preempted by the labeling requirements of the Hatch-Waxman Act. They also correctly held that Westerly is entitled to attorney s fees as costs under Rule 41(d). I. STANDARD OF REVIEW This court is reviewing the Twelfth Circuit s affirmation of the Motion for Judgment on the Pleadings and affirmation in part and reversal in part of the Motion for an Award of Costs, all granted in favor of Westerly. Appellate courts review a judgment on the pleadings de novo. Sanchez v. United States DOE, 2017 U.S. App. LEXIS 17475, at 28 (10th Cir. 2017). This standard of review is the same one that applies to reviewing a Rule 12(b)(6) motion to dismiss. Id. For a party to 8

16 win a motion for a judgment on the pleadings, the plaintiff must have alleged a plausible claim to relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In reviewing the claim, all factual allegations are taken as true and viewed in the light most favorable to the plaintiff. Sanchez, 2017 U.S. App. LEXIS at 28. The standard of review applied to a Motion for an Award of Costs, which is determining the appropriate scope of a rule of law, is also de novo. Andrews v. America s Living Ctrs., LLC., 827 F.3d 306, 309 (4th Cir. 2016). II. THE TWELFTH CIRCUIT CORRECTLY HELD THAT PETITIONER S STATE LAW CLAIMS WERE PREEMPTED BY CONFLICT PREEMPTION. The Twelfth Circuit correctly held that Petitioner s state law claims were preempted by both forms of conflict preemption, which are impossibility and obstacle preemption. The preemption doctrine dates back to the formation of our country. The Supremacy Clause of the United States Constitution states, This Constitution, and the Laws of the United States which shall be made in Pursuance thereof... shall be the supreme Law of the Land; and... any... Laws of any State to the Contrary notwithstanding. U.S. Const. art. VI, cl. 2. This principle that a federal law is supreme to, or preempts, a state law that contradicts or interferes with it is well-established. Geier v. Am. Honda Motor Co., 529 U.S. 861, 881 (2000); Freightliner Corp. v. Myrick, 514 U.S. 280, 287 (1995); Gibbons v. Ogden, 22 U.S. 1, 211 (1824). This Court has elaborated on the preemption analysis by holding that Congress can either explicitly preempt a state law, Jones v. Rath Packing Co., 430 9

17 U.S. 519, 525 (1977), or, if there is no explicit statement of preemption, their intent to preempt a state law can be inferred if the federal law is so comprehensive that it leaves no room for additional state legislation. Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947). Of the numerous types of preemption, the one at issue in this case is conflict preemption. Conflict preemption exists if compliance with both the federal and state laws is impossible or if the state law serves as an obstacle to one attempting to comply with a federal law. Oneok, Inc. v. Learjet, Inc., 135 S.Ct. 1591, 1595 (2015). The former preemption type is called impossibility preemption, see Oneok, 135 S.Ct. at 1595, whereas the latter is called obstacle preemption. See Hines v. Davidowitz, 312 U.S. 52, 67 (1941). Petitioner s claims are preempted by both impossibility preemption and obstacle preemption. A. THE FEDERAL LAW THAT PREEMPTS PETITIONER S STATE LAW CLAIM IS THE HATCH-WAXMAN ACT. The federal law that preempts Petitioner s state law claims in this case is the Drug Price Competition and Patent Term Restoration Act of 1984, commonly referred to as the Hatch-Waxman Act ( Act ). Mutual Pharmaceutical Co., Inc. v. Bartlett, 133 S.Ct. 2466, 2471 (2013). The provision of the Act at issue in this case permits companies to file an Abbreviated New Drug Application ( ANDA ) for a generic version of a drug after the patent on that drug has expired. See 21 U.S.C. 355(j) (2012). Petitioner s claims that Westerly was required to update its label directly conflict with the labeling requirements of this provision. 10

18 The Act requires that the ANDA must demonstrate that the generic drug is identical to a drug that has been previously approved ( listed drug ) in all material aspects. 21 U.S.C. 355(j)(2)(A) (2012). This is because the largest and most lucrative benefit of filing an ANDA is that, if all of the requirements are met, the applicant is not required to conduct the same lengthy clinical trials required for manufacturers of a listed drug. Bartlett, 133 S.Ct. at Specifically, the ANDA must include information that demonstrates that the generic drug has the same suggested use as the listed drug, that the active ingredient(s) in the generic drug is the same as those in the listed drug, that the dosage form and strength of the generic drug are equivalent to that of the listed drug, that the generic drug is the bioequivalent to the listed drug, and that the labeling of the generic drug is the same as that of the listed drug. Id. 355(j)(2)(A)(i-v). Once the ANDA is approved, the applicant cannot make any changes to the qualitative or quantitative formulation of the drug product, including active ingredients, or in the specifications provided in the approved application. 21 C.F.R (b)(2)(i). Furthermore, generic companies are specifically barred from making any unilateral changes to the drug s label, such that if they do, approval for the drug may be withdrawn. 21 C.F.R (b)(10); Bartlett, 133 S.Ct. at These labeling requirements preempt Petitioner s state law claims because it is impossible for Westerly to update its label without violating the Act and because compliance with the state law serves as an obstacle to compliance with the federal law. 11

19 If the Court finds that Petitioner s state law claims are preempted by either impossibility or obstacle preemption, the Court must affirm the holding of the Twelfth Circuit. B. PETITIONER S STATE LAW CLAIMS ARE PREEMPTED BY THE HATCH-WAXMAN ACT DUE TO IMPOSSIBLITY PREEMPTION. This Court should affirm the Twelfth District s holding that Petitioner s state law claims are preempted by the Hatch-Waxman Act due to impossibility preemption. When there is a direct conflict between a state and federal law, the federal law will prevail. PLIVA v. Mensing, 564 U.S. at 617. Furthermore, if the nature of the conflict is such that it makes it impossible for a private party to comply with both the federal law and the state law, the private party is only required to comply with the federal law. Id. at 618. It is well established that a generic drug company cannot act unilaterally to update its labeling on a drug. Id.; Bartlett, 133 S.Ct. at In Mensing, the Court evaluated whether the state requirement for a generic drug manufacturer to unilaterally update their warning labels was preempted by federal drug regulations. Mensing, 564 U.S. at 609. The plaintiffs alleged that the generic drug manufacturer had failed to provide adequate warning labels for a drug they sold. Id. at The plaintiffs claimed that the generic manufacturer was capable of complying with their state law duty to strengthen their label to include a warning for the drug irrespective of federal law and regardless of whether its listed drug counterpart had also done so. Id. at 614. The Court disagreed with this argument. 12

20 Id. at 615. The Court held that the state failure to update claim was preempted by the labeling requirements of the Hatch-Waxman Act because it was impossible for the private party to comply with both laws simultaneously. Id. at 618. In order for an ANDA to be approved, a generic company is required to use the already approved labels of their branded counterpart. Id. at 613. Furthermore, even after approval, the generic company may not independently alter their label. Id. at 617. Thus, a state law claim requiring a generic company to alter its labeling in any way such that it becomes inconsistent with the labels of the branded counterpart drug directly conflicts with the federal requirement that generic companies must not unilaterally alter their warning labels. Id. at 624. The Court addressed a similar issue to the one in Mensing a couple years later in Bartlett. Bartlett, 133 S.Ct. at In Bartlett, the Court addressed the issue of whether federal law preempted state law design defect claims against generic drug companies. Id. Relying on the reasoning of Mensing, the Court held that state-law defect claims that turn on the adequacy of a drug s warnings are pre-empted by federal law under PLIVA. Id. The plaintiff in Bartlett alleged that the generic manufacturer had a duty under state law to remedy the design defect of failing to include adequate warnings regarding possible side effects for the drug. Id. The Court, however, applied the rule of Mensing, which held that failure-to-warn claims against generic manufacturers are pre-empted by the FDCA s prohibition on changes to generic drug labels. Id. at The Court reasoned that it was impossible for the generic company to comply with the state law duty of updating 13

21 their labels, while simultaneously complying with its federal law duty of maintaining its labels to be identical to that of the listed drug. Id. at Westerly Was Under No Duty to Comply with State Products Liability Labeling Laws at the Time Petitioner Purchased Ropidope. Westerly was under no duty to comply with state products liability labeling laws at the time Petitioner purchased ropidope. The issues of Mensing and Bartlett are the same as the one in this case: whether the FDCA s drug labeling requirements under Hatch-Waxman preempted Petitioner s state law claims against a generic drug manufacturer. (R. at 13.) Although in this case GlaxoCline, the branded company selling ropidope, requested a labeling change that was approved and implemented in June of 2011, the same preemption principles from Mensing and Bartlett apply. (R. at 2.) Petitioner began taking ropidope in March (R. at 1.) At that time, neither GlaxoCline nor Westerly had any information on their label that warned consumers about potential side effects affecting their ability to control their impulses. (R. at 2.) Petitioner claims that Westerly violated IPLA by defectively designing their drug labels because they contained inadequate warnings regarding the side effects on impulse control. (R. at 3.) However, the standard set by Bartlett and Mensing makes it clear that a generic company may not take unilateral action to change their label so to comply with state law labeling duties. Bartlett, 133 S.Ct. at 2479; Mensing, 564 U.S. at 618. Therefore, at the time Petitioner purchased ropidope from Westerly, Westerly was under no duty to 14

22 comply with IPLA because it was impossible to comply with the state law and the labeling laws of the Hatch-Waxman Act. 2. Westerly Was Under No Duty to Comply with IPLA Even After GlaxoCline Updated its Drug Labels for Ropidope. Westerly was under no duty to comply with IPLA after GlaxoCline updated its drug labels for ropidope. Because Westerly had no duty to comply with IPLA at the time Petitioner purchased ropidope, the issue becomes whether Westerly had a duty to comply with IPLA after GlaxoCline updated their label to include a warning about the side effects of ropidope on impulse control and compulsive behavior. (R. at 2.) Westerly had no such duty. Under federal law, Westerly was required to ensure that, when submitting an ANDA, its drug label matched the label of GlaxoCline. See 21 U.S.C. 355(j)(2)(A)(v). GlaxoCline s updated label went into effect in June (R. at 2.) Six months later, Westerly contacted the FDA to inform them that they would be updating their label to match that of GlaxoCline and implemented the change merely one month later. (R. at 10.) Under the Hatch-Waxman Act, there is no mandated procedure generic companies must follow when updating their drug labels after approval of their ANDA. Mensing, 564 U.S. at 614. Instead, it requires that a generic drug s label must match that of the listed drug. Morris v. Pliva, Inc., 713 F.3d 774, 777 (5th Cir. 2013). These requirements ultimately control the whole process by which branded and generic companies apply for and update their labels. Mensing, 564 U.S. at

23 The Twelfth Circuit found that state laws do not take into account the federally mandated labeling process for generic companies. (R. at 15.) Namely, the Twelfth Circuit found that state tort law claims, including claims under IPLA, employ a reasonableness standard. (R. at 15.) The Twelfth Circuit reasoned that, since Westerly did update its labels to include the warning about the effect of ropidope on impulse control, the issue therefore becomes whether Westerly failed to update their label within a reasonable amount of time from GlaxoCline s label change. (R. at 15.) Under this analysis, the Twelfth Circuit again found that IPLA and the Hatch-Waxman Act conflict. (R. at 15.) The Twelfth Circuit reasoned that because the reasonableness requirement of IPLA differs from the labeling requirements mandated by the Hatch-Waxman Act, it was impossible for Westerly to comply with both standards. (R. at 15.) In this case, the only consideration under IPLA was whether Westerly s product was unreasonably dangerous as a result of defective design and inadequate instructions or warnings. (R. at 3.) The juxtaposition of the duty required by IPLA against the labeling requirements of the Hatch-Waxman Act results in a direct conflict of state and federal law because it is impossible for a generic company to simultaneously comply with federal labeling requirements and state law reasonableness standards that don t contemplate the federally mandated process. Therefore, it was impossible for Westerly to comply with both. Petitioner will likely claim that it was possible for Westerly to comply with both the state and federal laws. They will presumably argue that the laws were not 16

24 in conflict because, due to the labeling update of GlaxoCline, Westerly would not be unilaterally changing their labels. However, this exact scenario was envisioned, and the argument was rejected, in Mensing. In Mensing, the court stated that, federal law would permit the Manufacturers to comply with the state labeling requirements if, and only if, the FDA and the brand-name manufacturer changed the brand-name label to do so. Mensing, 564 U.S. at 620. While Petitioner may assert that this supports their claim that Westerly had a state law duty to update their labels, the Court has already addressed this scenario. Id. The court in Mensing clarifies that the question to be asked concerning impossibility preemption is whether the private party could independently do under federal law what state law requires of it. Id. As held in Mensing and Bartlett, Westerly could not independently comply with IPLA and unilaterally update its labeling. The court continued its analysis of impossibility preemption by rejecting the argument that the petitioners could not prove that it was actually impossible for them to comply with both state and federal laws. Id. The court stated that, although the potential actions of a third party could resolve the conflict of laws, they should not be considered. Id. They reasoned that if the Court routinely imagined what another party might do, there would always be the possibility that there is no longer a conflict between the state and federal laws. Id. at 621. The court found this line of logic to be a slippery slope to abolishing all forms of implied preemption. Id. The court stated, [i]f these conjectures suffice to prevent federal and state law from 17

25 conflicting for Supremacy Clause purposes, it is unclear when, outside of express preemption, the Supremacy Clause would have any force. Id. The standard set forth by Mensing and Bartlett is clear: state law claims against generic companies alleging failure to update or design defect claims are preempted by the Hatch-Waxman Act because it is impossible to comply with both laws. Bartlett, 133 U.S. at 2478; Mensing, 564 U.S. at 618. Furthermore, when conducting an impossibility analysis, courts must resist considering the actions of third parties to decide whether complying with both laws is truly impossible since there is always a possibility that compliance may be attainable. Mensing, 564 U.S. at 621. Thus, Petitioner s claims are preempted by federal law due to impossibility preemption. C. PETITIONER S STATE LAW CLAIMS ARE PREEMPTED BY THE HATCH-WAXMAN ACT DUE TO OBSTACLE PREEMPTION. Petitioner s state law claims are preempted by the Hatch-Waxman Act due to obstacle preemption. Obstacle preemption occurs when a state law serves as an obstacle to the accomplishment and execution of the purposes and objectives of Congress. Howell v. Howell, 137 S.Ct. 1400, 1406 (2017); see Hughes v. Talen Energy Mktg., LLC, 136 S.Ct. 1288, 1297 (2016); see also Hines, 312 U.S. at 67. Therefore, even if this Court found that Petitioner s failure to update claims are not preempted by impossibility preemption because it was possible for Westerly to comply with both state and federal law, Petitioner s claims are still preempted due to obstacle pre-emption. 18

26 This Court has previously found that a state law duty that requires manufacturers to take additional precautions beyond what is required by federal law presents an obstacle to the accomplishment of the federal law. Geier, 529 U.S. at 881. In Geier, the court held that a state law duty mandating automobile manufacturers to install additional airbags beyond what the federal law actually required created an obstacle to achievement of the objective of the Department of Transportation. Id. at 886. Thus, the state tort claim was preempted. Id. This is analogous to the present case. The state tort law at issue would require Westerly, a generic manufacturer, to unilaterally update its drug labeling to include risks of any harmful side effects, which is beyond what the Hatch-Waxman Act requires. (R. at 3.) Any state law interfering with the labeling requirements of the Hatch- Waxman Act is an issue because, as previously mentioned, the FDA controls the process by which generic drug companies go about filing an ANDA via the Act. 21 U.S.C. 355(j)(2)(A). Not only is the process of filing an ANDA uniform across the entire United States, the purpose of it is to ensure that the generic drug, including its labeling, is identical to that of its corresponding listed drug so that it can be approved for marketing faster than a listed drug. See Mensing, 564 U.S. at 613. Just as in Geier, the state law at issue frustrates the purpose of the FDA to control the labeling requirements for generic drugs by imposing additional duties that would otherwise be absent. Therefore, the state law duty of a generic drug company to update its labels creates an obstacle to the achievement of the purposes of the 19

27 Hatch-Waxman Act to carefully mandate generic drug company labeling laws such that generic drugs become more readily available to consumers. Furthermore, if state duties of reasonableness and adequacy are imposed on generic companies, it would significantly impede the process of filing an ANDA by requiring additional burdensome steps. Petitioner will likely rely on Wyeth to claim that state tort claims concerning drug labeling do not serve as an obstacle to complying with federal regulations. Wyeth v. Levine, 555 U.S. 555, 580 (2009). In Wyeth, the court held that the Federal Drug and Cosmetic Act (FDCA) does not have a preemptive effect on state laws establishing a duty for drug manufacturers concerning labeling requirements. Id. at 581. The court held that despite the FDA s announcement that the FDCA would preempt any state laws on the issues contained therein, the history of the FDA did not support that preemption claim. Id. at 577. While this case does address an issue concerning the conflicting laws on labeling requirements imposed by the state and federal governments, it differs from the instant case in a significant way: the analysis in Wyeth was concerning branded drug manufacturers, not generic drug manufacturers. The distinction between a branded drug manufacturer and a generic drug manufacturer is important. When looking at the intent of the FDA in regulating labeling requirements of branded drugs, it is clear that the FDA intended to provide a series of requirements that only branded drug manufacturers must meet. Id. at 567. These requirements, however, greatly differ from those for generic drug 20

28 manufacturers. Id. The branded manufacturer is required to demonstrate that the drug is safe for use under the conditions prescribed, recommended, or suggested in the proposed labeling before it could distribute the drug. Id. The generic company, on the other hand, is required to ensure that its labels are identical to those of the branded drug. Morris, 713 F.3d at 777. Therefore, the conclusions of the court in Wyeth that the FDA s intent concerning preemption apply to branded manufacturers, but not generic drug companies like Westerly. Thus, the opinion in Geier is still the most applicable holding and demonstrates that if a state law serves as an obstacle to the achievement of the federal law, as in this case, it is preempted due to obstacle preemption. Therefore, Petitioner s claims are preempted by the Hatch-Waxman Act due to obstacle preemption because it serves as an obstacle to the accomplishment and execution of the purposes and objectives of Congress. This Court should hold that Petitioner s claims are preempted by the Hatch- Waxman act due to impossibility preemption and obstacle preemption. III. THE TWELFTH CIRCUIT CORRECTLY HELD THAT AWARDABLE COSTS CONSIDERED BY RULE 41(d) INCUDE ATTORNEY S FEES. The Twelfth Circuit correctly found that attorney s fees should be included when calculating awardable costs under Rule 41(d) of the Federal Rules of Civil Procedure. The Federal Rule of Civil Procedure 41(d) states: If a plaintiff who previously dismissed an action in any court files an action based on or including the same claim against the same defendant the court: 21

29 (1) May order the plaintiff to pay all or part of the costs of that previous action; and (2) May stay the proceedings until the plaintiff has complied. Fed. R. Civ. P. 41(d). Although Rule 41(d) does not explicitly state that attorney s fees are included in costs, many courts have addressed whether such fees should be included. Andrews, 827 F.3d at 309. The majority of courts that have addressed this issue have found that attorney s fees should be awarded as costs because doing so serves as a deterrent for a plaintiff from forum shopping and vexatious litigation. Simeone v. First Bank Nat l Ass n, 971 F.2d. 103, 108 (8th Cir. 1992). Courts have also found that it was Congress s intent to purposefully write Rule 41(d) in such a manner that permits attorney s fees as costs. Marek v. Chesny, 473 U.S. 1, 9 (1985). Although the primary reason courts award attorney s fees is to serve as a deterrent for the plaintiff, the defendant does not have to prove that the plaintiff acted in bad faith. See Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 874 (6th Cir. 2000); Esquivel v. Arau, 913 F. Supp. 1382, 1388 (C.D. Cal. 1996). ). Instead, the legal standard a party must establish is that: (1) a plaintiff s previous action was dismissed; (2) a second action was commenced that is based upon or includes the same claim against the same defendant; and (3) there are costs and attorneys fees incurred by the defendant in the prior action that will not be useful in the newly-filed litigation. Fed. R. Civ. P. 41(d); see Seipel v. Bank of Am., N.A., 239 F.R.D. 558, 563 (E.D. Mo. 2006). The courts have established that this legal standard provides 22

30 broad discretion to district courts in determining whether to award costs to a defendant under Rule 41(d). See Esquival, 913 F. Supp. at The courts that have awarded attorney s fees as costs under Rule 41(d) have done so when there is an exception to the American Rule, which states that attorney s fees shall not be awarded. Alyeska Pipeline Serv. Co. v. Wilderness Soc y, 421 U.S. 240, 247 (1975). Although the American Rule does not permit courts to award attorney s fees as costs, courts have determined that there are particular circumstances where the American Rule does not apply. Esposito v. Piatrowski, 223 F.3d 497, 500 (7th Cir. 2000); Marek, 473 U.S. at 9. This Court should hold that attorney s fees are awardable as costs under Rule 41(d) because it was Congress s purpose to include the allowance of attorney s fees, and alternatively, because awarding attorney s fees falls within the courts discretion to deter vexatious litigation or forum shopping. A. A COURT MAY AWARD ATTORNEY S FEES AS COSTS UNDER RULE 41(d) WHEN THE UNDERYLYING STATUTE OF A CLAIM PERMITS AN AWARD OF ATTORNEY S FEES. An award for attorney s fees is allowable under Rule 41(d if the underlying statute from which a claim is made allows for the award of attorney s fees. Courts traditionally adhere to the American Rule, which holds that attorney s fees are not to be awarded as costs. Esposito, 233 F.3d at 500; see Alyeska, 421 U.S. at 247. Therefore, presumably, any possibility of awarding attorney s fees as costs would require a determination that Congress intended to shift away from the American 23

31 Rule. Esposito, 223 F.3d at 500; Key Tronic Corp. v. United States, 511 U.S. 809, 815 (1994). However, in analyzing the ruling of Marek v. Chesny, the Seventh Circuit noted that there are instances in which attorney s fees can be awarded despite the court s general adherence to the American Rule. Id. Specifically, this Court addressed whether Federal Rule of Civil Procedure Rule 68 included attorney s fees as costs. Marek, 473 U.S. at 4. Rule 68 allows for an award of costs, but does not define what costs are permitted to be awarded. Id.; see Andrews, 827 F.3d at 310. The court in Marek noted that the authors of the Federal Rules were likely aware of the American Rule when drafting Rule 68, such that the vagueness of the rule was likely intentional. Marek, 473 U.S. at 9. Thus, the court in Marek reasoned that Rule 68 was intended to include an award of all costs that are awardable under the relevant substantive statute at issue. Id. The court in Esposito applied the reasoning in Marek to determine whether attorney s fees are permitted under Rule 41(d). Esposito, 223 F.3d at 501. Similar to Rule 68, Rule 41(d) refers to costs, but fails to define the term. Id. The court also held that attorney s fees may be included as costs if the statute under which the plaintiff has brought a claim defines costs to include attorney s fees. Id. The court noted that the Marek holding was consistent with prior treatment of attorney s fees under other provisions of Rule 41, such as Rule 41(a)(2). Id.; see LeBlang Motors Ltd. v. Subaru of America, Inc., 148 F.3d 680, 686 (7th Cir. 1998). The court in Esposito reasoned that it would be inconsistent to award attorney s fees under Rule 41(a)(2) as a condition of voluntary dismissal, yet prohibit attorney s fees when a 24

32 case is voluntarily withdrawn and refiled under 41(d). Esposito, 223 F.3d at 501; Esquivel, 913 F. Supp. at The Fourth Circuit adopted the reasoning of the Seventh Circuit in holding that attorney s fees may be awarded if the statute under which the plaintiff is seeking relief provides for attorney s fees. Andrews, 827 F.3d at 310. The court in Andrews addressed the issue of whether Rule 41(d) permitted attorney s fees to be awarded as costs when the plaintiff voluntarily withdrew the complaint filed against the employer and subsequently refiled the complaint under the Fair Labor Standards Act. Id. at 306. The court held that although Rule 41(d) does not provide for attorney s fees as matter of right;... a district court may award attorney s fees under [41(d)] where the underlying statute provides for attorney s fees. Id. at 311. The Court reasoned that the ruling would strike a balance between the American Rule and the goal of Rule 41(d) to prevent vexatious litigation and forum shopping by a plaintiff. Id. The court further agreed with the Esposito court in finding that the ruling on Rule 41(d) would prevent inconsistent interpretations more generally under Rule 41. Id. The court found that, similarly to the Seventh Circuit, the Fourth Circuit had previously held that attorney s fees were awardable under 41(a)(2), see Davis v. USX Corp., 819 F.2d 1270, 1276 (4th Cir. 1987), and a prohibition of attorney s fees under Rule 41(d) would create inconsistencies within the rule. Id. The only Circuit court to hold that attorney s fees are not included as costs under Rule 41(d) is the Sixth Circuit. Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868 (6th Cir. 2000). The Rogers court reasoned that attorney s fees are not available 25

33 under Rule 41(d) because the rule did not explicitly include attorney s fees. Id. at 874. However, the court conceded that the majority of courts have concluded that attorney fees may be awarded under Rule 41(d). Id.; Duffy v. Ford Motor Co., 218 F.3d 623, 632 (6th Cir. 2000). Furthermore, the court noted that attorney s fees may be awarded even if not expressly provided for, if the statute otherwise evinces an intent to provide for such fees. Rogers, 230 F.3d at 875; Key Tronic Corp. 511 U.S. at 815. In this case, The Twelfth Circuit relied on the holdings of the majority of the circuit courts when determining that the awardable costs contemplated by Rule 41(d) include attorney s fees. (R. at ) The Twelfth Circuit also correctly noted that although the Sixth Circuit did not join the majority, they conceded the possibility that Rule 41(d) permits attorney s fees to be included. (R. at 17.) Unlike the Sixth Circuit, the Twelfth Circuit rightly sought to avoid inconsistent interpretations of Rule 41(d) by awarding attorney s fees as costs. In this case, the Twelfth circuit reasoned that although costs are not defined under Rule 41(d), the majority of circuits that have addressed the issue found that attorney s fees are permitted under Rule 41(d). (R. at 17.) Similar to the analysis in Esposito and Andrews, this case addresses the issue of how to properly interpret the vagueness of Rule 41(d). Following the reasoning of prior decisions, the Twelfth Circuit found no need to create inconsistent interpretations within Rule 41 and agreed with the positions of several other Circuits to permit attorney s fees to be included as costs. (R. at 18). Therefore, this Court should follow the majority position that attorney s 26

34 fees are permitted as costs under Rule 41(d) and should affirm the Twelfth Circuit s holding that costs under Rule 41(d) include attorney s fees. B. AWARDING ATTORNEY S FEES AS COSTS UNDER RULE 41(d) FURTHERS THE RULE S PURPOSE OF DETERRING VEXTIOUS LITIGATION AND FORUM SHOPPING. Awarding attorney s fees as costs under Rule 41(d) contributes to the purpose of the rule, which is to deter vexatious litigation and forum shopping. Both the Eighth and Tenth Circuits have held that district courts have the discretion to award attorney s fees as costs under Rule 41(d). See Evans v. Safeway Stores, Inc., 623 F.2d 121, (8th Cir. 1980); Meredith v. Stovall, 2000 U.S. App. LEXIS 14553, 5 (10th Cir. 2000). In holding that there was no abuse of discretion by the district court by awarding attorney s fees, the court in Meredith noted that that the language of Rule 41(d) created a purpose of preventing vexatious law suits by using the possibility of the defendant being awarded attorney s fees as costs as a deterrent. Meredith, 2000 U.S. App. LEXIS at 4. Additionally, the court in Andrews held that a district court has the discretion to award attorney s fees if the court finds that a plaintiff has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. Andrews, 827 F.3d at 311. In Andrews, the plaintiff voluntarily dismissed their first action following a hearing on a motion to dismiss so that they could avoid an adverse ruling. Id. at 312. The plaintiff then refiled their complaint that same day. Id. However, the court noted that, in this situation, a voluntary dismissal was encouraged. Id. at 314. Thus, the court held that attorney s fees were not permissible, but did not foreclose 27

35 the possibility that they could be awardable under the right circumstances. Id. The court reasoned that the ruling upheld the purpose of Rule 41(d) to prevent forum shopping and vexatious litigation. Id. The court in Andrews relied on the reasoning in Esposito and Sanderson to reach this determination. Id. at 311. In Esposito, the Seventh Circuit briefly noted that awarding fees as part of costs supports the purpose of Rule 41(d) to deter forum shopping and vexatious litigation. Esposito, 223 F.3d at 501; See Simeone, 971 F.2d at 108. The Fourth Circuit also acknowledged that the court in Sanderson allowed for attorney s fees under Rule 41(d) when the opposing party has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. Andrews, 827 F.3d at 311; Sanderson v. Spectrum Labs, Inc., 248 F.3d 1159, 6 (7th Cir. 2000); quoting F.D. Rich Co., Inc. v. United States ex rel. Indus. Lumber Co., 417 U.S. 116, 129 (1974). In this case, the plain meaning of Rule 41(d) includes attorney s fees as costs. Although the Rule does not explicitly define costs, it s purpose of preventing vexatious litigation demonstrates that reasonable costs including attorney s fees should be provided. Contrary to the dissenting position, the fact that Rule 41(d) does not automatically award costs does not prevent an award of attorney s fees because the court still retains the discretion to award attorney s fees if the court determines that an opposing party has engaged in vexatious litigation or forum shopping such that they are acting in bad faith. In this case, Petitioner filed a Notice of Voluntary Dismissal quickly following the Fifth Circuit s unfavorable 28