Supreme Court of the United States

No. 17-230 IN THE Supreme Court of the United States Fall Term, 2017 Alice IVERS, Petitioner, v. WESTERLY PHARMACEUTICAL, INC., Respondent. On Writ of Certiorari to the Twelfth Circuit Court of Appeals BRIEF FOR RESPONDENT

ii Attorneys for Respondent Team 2069

QUESTIONS PRESENTED I. Whether implied preemption makes it impossible for Westerly to simultaneously comply with conflicting Illinoza state and federal labeling laws, and frustrates the overall purpose of the Hatch-Waxman Act. II. Whether under the Federal Rule of Civil Procedure 41(d), this Court should use its discretion to award attorney s fees to Westerly in furtherance of perpetual congressional intent to preclude frivolous lawsuits. i

TABLE OF CONTENTS QUESTIONS PRESENTED... TABLE OF CONTENTS... TABLE OF AUTHORITIES... i ii iv OPINIONS BELOW... 1 STANDARD OF REVIEW... 1 STATEMENT OF THE CASE... 2 Statement of Facts... 2 Procedural History... 4 SUMMARY OF THE ARGUMENT... 5 ARGUMENT... 6 I. THE COURT OF APPEALS FOR THE TWELFTH CIRCUIT CORRECTLY RECOGNIZED THE IMPOSSIBILITY OF FEDERAL AND STATE LAW COMPLIANCE UNDER THE PREEMPTION DOCTRINE, WHILE ALSO PRESERVING THE CONGRESSIONAL PURPOSE OF THE HATCH-WAXMAN ACT.... 6 A. The Court of Appeals Correctly Concluded that it Was Impossible for Westerly, a Generic Manufacturer, to Comply with both its State Law Continual Duty to Update the Warning Labels and its Federal Duty not to Unilaterally Alter its Label.... 6 1. Federal law creates a restricted framework such that generic manufacturers are impossibly limited from independently changing labels to comply with state imposed requirements.... 7 2. Brand name and generic manufacturers have distinct duties in regards to the accuracy and adequacy of their labels, deeming generic manufacturers at the mercy of brand name label changes.... 9 ii

B. Recognition of State Law Is Rightfully Preempted by Federal Law Because Recognition Creates an Untenable Obstacle to Congress Objective of Improving Healthcare Costs and Patient Welfare.... 11 II. THE COURT OF APPEALS FOR THE TWELFTH CIRCUIT CORRECTLY DISTILLED CONGRESSIONAL INTENT TO INCLUDE ATTORNEY S FEES AS AWARDABLE COSTS UNDER RULE 41(d)... 15 A. Congressional Intent to Include Attorney s Fees in Costs Is Apparent in Rule 68 and the Civil Rights Attorney s Fees Awards Act of 1976.... 16 B. The Purpose of Rule 41(d) Is to Discourage Vexatious Litigation, which Calls for the Rejection of the American Rule Disallowing the Award of Attorney s Fees.... 17 CONCLUSION... 21 Appendix A... Appendix B... A1 B1 iii

TABLE OF AUTHORITIES Constitution of the United States U.S. CONST. art. VI... 5, 6 United States Supreme Court Cases Alyeska Pipeline Serv. Co. v. Wilderness Soc y, 421 U.S. 240 (1975)... 20 Freightliner Corp. v. Myrick, 514 U.S. 280 (1995)... 11 Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010)... 18 Marek v. Chesney, 473 U.S. 1 (1985)... 16, 17 Medtronic v. Lohr, 518 U.S. 470 (1996)... 14, 15 Mutual Pharmaceutical v. Bartlett, 133 S. Ct. 2466 (2013)... 8, 9, 13 Pierce v. Underwood, 487 U.S. 552 (1998)... 1 PLIVA Inc. v. Mensing, 564 U.S. 604 (2011)... passim Ruckelshaus v. Sierra Club, 463 U.S. 680 (1983)... 20 Wyeth v. Levine, 555 U.S. 555 (2009)... 10 United States Court of Appeals Cases Brice v. State, Dept. of Correction, 704 A.2d 1176 (Del. 1998)... 19, 20 iv

Esposito v. Piatrowski, 223 F.3d 497 (7th Cir. 2000)... 18 Evans v. Safeway Stores, Inc., 623 F.2d 121 (8th Cir. 1980)... 18 Morris v. PLIVA, 713 F.3d 774 (2013)... 8, 9 Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868 (6th Cir. 2000)... 16 United States District Court Cases Behrle v. Olshansky, 139 F.R.D. 370 (W.D. Ark. 1991)... 18 Eager v. Kain, 158 F. Supp. 222 (E.D. Tenn. 1957)... 18 Esquivel v. Arau, 913 F. Supp. 1382 (C.D. Cal. 1996)... 16 Phoenix Canada Oil Co. v. Texaco, Inc., 78 F.R.D. 445 (D. Del. 1978)... 19 RLS Assocs., LLC v. United Bank of Kuwait PLC, 464 F. Supp. 2d 206 (S.D.N.Y. 2006)... 18 Federal Statutes 21 U.S.C.A. 355... 7, 13 28 U.S.C.A. 1332... 4 28 U.S.C.A. 1441... 4 42 U.S.C.A. 1988... 17 Federal Rules Fed. R. Civ. P. 12(c)... 1, 4 Fed. R. Civ. P. 41(d)... passim v

Fed. R. Civ. P. 68... 16, 17, 21 Secondary Sources Aaron S. Kesselheim & Jonathan J. Darrow, Hatch-Waxman Turns 30: Do We Need A Re-Designed Approach for the Modern Era?, 15 YALE J. HEALTH POL'Y, L. & ETHICS 293 (2015).... 5, 11, 12, 13 Allison K. Young & Meredyth Smith Andrus, Pharmaceutical pricing and Hatch-Waxman reform: The Right Prescription, 1 J. OF GENERIC MED. 288 (2004)... 11 Colleen Kelly, The Balance Between Innovation and Competition: The Hatch-Waxman Act, the 2003 Amendments, and Beyond, 66 FOOD & DRUG L.J. 417 (2011)... 11, 12, 14 David A. Kessler & David C. Vladeck, A Critical Examination of the Fda's Efforts to Preempt Failure-to-Warn Claims, 96 GEO. L.J. 461 (2008)... 11, 12, 15 Jane E. Brody, The Cost of Not Taking Your Medicine, N.Y. TIMES, April 17, 2017, at D7... 12 John Leubsdorf, Toward a History of the American Rule on Attorney Fee Recovery, 47 L. & CONTEMP. PROB. 9 (1984)... 18 Thomas S. Rector & Patricia J. Venus, Do Drug Benefits Help Medicare Beneficiaries Afford Prescribed Drugs?, 23 HEALTH AFF. 213, 219 (2004)... 12 Other Authorities Michael Rezak, How Dopamine Replacement Therapy Works, THE ROLE OF DOPAMINE AGONISTS IN PARKINSON S TREATMENT, https://www.apda parkinson.org/the-role-of-dopamine-receptor-agonists-in-pd/.... 2 vi

No. 17-230 IN THE SUPREME COURT OF THE UNITED STATES FALL TERM 2017 Alice IVERS, Petitioner v. WESTERLY PHARMACEUTICAL, INC., Respondent ON WRIT OF CERTIORARI TO THE UNITED STATES SUPREME COURT OF APPEALS FOR THE TWELFTH CIRCUIT BRIEF FOR RESPONDENT 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. STANDARD OF REVIEW For review by this Court is the Twelfth Circuit s affirmation of Westerly s motion for judgment on the pleadings under Federal Rule of Civil Procedure ( F.R.C.P. ) Rule 12(c) on the preemption doctrine, and of Westerly s motion for an award of costs under F.R.C.P. Rule 41(d). This Court reviews questions of law de novo. See Pierce v. Underwood, 487 U.S. 552, 558 (1998) (holding that the court 1

reviews de novo a district court s decision to grant judgment based on the pleadings). STATEMENT OF THE CASE Statement of Facts In 1997, GlaxoCline LLC patented ropidope and received the Federal Drug Administration ( FDA ) approval to market as a new drug under the brand name Equip. (R. at 2.) Ropidope is a non-ergoline dopamine agonist used to treat Parkinson s disease by mimicking dopamine and activating a patient s dopamine receptors to help smooth motor function. (R. at 2.) Dopamine agonists were originally used as adjunctive therapy for Parkinson s patients, as the drugs regulate dopamine levels without metabolizing the neurotransmitter, unlike traditional drug therapies which metabolized and destabilized dopamine levels. Michael Rezak, How Dopamine Replacement Therapy Works, THE ROLE OF DOPAMINE AGONISTS IN PARKINSON S TREATMENT, https://www.apdaparkinson.org/the-role-of-dopaminereceptor-agonists-in-pd/. Furthermore, agonists as a class have an overall increased safety margin with respect to dopaminergic side effects, such as dyskinesia or motor fluctuations, particularly when compared to other medicines. Id. In 2008, GlaxoCline s patent on Ropidope expired. (R. at 2.) Westerly Pharmaceuticals, Inc. ( Westerly ), a generic manufacturer, submitted an Abbreviated New Drug Application ( ANDA ) to the FDA, seeking approval to market an equivalent generic version of ropidope. (R. at 2.) The FDA granted Westerly s application a year later and ordered Westerly to mirror GlaxoCline s 2

label. (R. at 2.) Westerly complied with this requirement and shortly thereafter began selling generic ropidope in 2009. (R. at 2.) In January 2011, GlaxoCline submitted a Supplemental New Drug Application requesting prior approval of proposed changes to its Package Insert and associated labeling. (R. at 2.) The changes added language advising prescribers to specifically ask patients or their caregivers about the development of increased gambling urges, sexual urges, uncontrolled spending... or other urges while being treated with Equip. Physicians should consider dose reduction or stopping medication if a patient develops such urges while taking Equip. (R. at 2.) In compliance with the Federal Drug and Cosmetics Act ( FDCA ), any labeling changes to FDA approved brand name drugs must be pre-approved by the FDA, and a generic manufacturer must use the same labeling as the approved brand name drug. (R. at 12.) In February 2011, Petitioner Alice Ivers was diagnosed with Parkinson s disease. (R. at 1.) One of her medications prescribed was ropidope hydrochloride, and she began taking Westerly s generic version of ropidope in March 2011. (R. at 1.) In June 2011, the FDA finally approved labeling changes for GlaxoCline s Equip. (R. at 2.) Pursuant to FDA regulations, Westerly submitted a Changes Being Effected notification to the FDA. (R. at 3.) Westerly agreed to update its ropidope labels to match the newly approved labels for Equip six months after the new Equip labels were officially approved, to be effective on February 1, 2012. (R. at 3, 13.) 3

After her diagnosis, Petitioner developed compulsive spending and gambling behaviors in July 2011. (R. at 3.) From 2011 to 2012, Petitioner played online poker continually, and won substantial sums of money. Later, Petitioner claimed she felt compelled to spend the money on charitable gifts and antique auctions. (R. at 3.) By the end of 2012, she had spent all her retirement savings. (R. at 3.) Petitioner claimed Westerly s delay in label updating implicates Westerly for her compulsive gambling habit. (R. at 10.) Procedural History The present case has reached this Court from a series of decisions, most which that ended in favor of the Respondent, Westerly Pharmaceuticals, Inc. On September 15, 2015, Petitioner filed a Complaint against Respondent in the state court of Illinoza. (R. at 1.) Respondent appropriately removed the action from state court to federal district court on October 14, 2015, citing diversity jurisdiction under 28 U.S.C.A. 1332 and removal jurisdiction under 28 U.S.C.A. 1441. (R. at 1, 3.) On November 2, 2015, Respondent filed its Answer to the Complaint and filed a Rule 12(c) Motion for Judgment on the Pleadings and a Motion for an Award of Costs under Rule 41(d). (R. at 3.) The District Court of Illinoza granted Respondent s Rule 12(c) Motion and dismissed the Complaint in its entirety in a Memorandum Opinion and Order issued December 20, 2015. (R. at 1.) The court held that the FDCA and the FDA s implementing regulations preempted Petitioner s theory of liability. (R. at 11.) In addition, the court granted all costs for a total of $876.52, but excluded $3,442 in attorney s fees. (R. at 11.) 4

Petitioner filed a timely notice of appeal on January 14, 2016. (R. at 11.) Westerly filed a timely cross-appeal on January 15, 2016, contesting the decision denying attorney s fees as costs. (R. at 11.) The appeal was argued on November 15, 2016 and decided on February 2, 2017. (R. at 11.) The Court of Appeals for the Twelfth Circuit affirmed the district court s dismissal of the Complaint. (R. at 11.) The appellate court affirmed the district court s decision to award costs to Respondent under F.R.C.P. 41(d) and reversed the portion of the order denying attorney s fees as part of those costs. (R. at 11.) Petitioner filed the present appeal and the Supreme Court granted a writ of certiorari on July 17, 2017. (R. at 23.) SUMMARY OF THE ARGUMENT Implied preemption is found where it is impossible for a party to comply with both federal and state law and where state law frustrates the accomplishment and execution of the full purposes and objectives of Congress. See PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011). First, it is impossible for generic manufacturers to comply with a state imposed continual duty to update the warning labels and its federal duty under the FDCA not to unilaterally alter its label. Second, as applied to Westerly, imposing state liability would frustrate Congress and the FDA s overall objectives of the Hatch-Waxman Act of increased generic drug entry, lower healthcare costs, and improved patient welfare. See Aaron S. Kesselheim & Jonathan J. Darrow, Hatch-Waxman Turns 30: Do We Need A Re-Designed Approach for the Modern Era?, 15 YALE J. HEALTH POL'Y, L. & ETHICS 293, 301 (2015). 5

Upon interpretation of federal rules, Congress has constantly included attorney s fees in costs. Furthermore, the fundamental purpose of Rule 41(d) is to protect parties from vexatious litigation. The American Rule, which holds that each litigant is responsible for their own attorney s fees, contradicts Congress objective. The American Rule must be rejected in this circumstance. Therefore, this Court should affirm the Twelfth Circuit s decision to include attorney s fees as awardable costs under Rule 41(d). ARGUMENT I. THE COURT OF APPEALS FOR THE TWELFTH CIRCUIT CORRECTLY RECOGNIZED THE IMPOSSIBILITY OF FEDERAL AND STATE LAW COMPLIANCE UNDER THE PREEMPTION DOCTRINE, WHILE ALSO PRESERVING THE CONGRESSIONAL PURPOSE OF THE HATCH-WAXMAN ACT. The Supremacy Clause of the United States Constitution requires that federal law shall be the supreme Law of the Land; and preempt state law the Judges in every State shall be bound thereby. U.S. CONST. art. VI, cl. 2. A. The Court of Appeals Correctly Concluded that it Was Impossible for Westerly, a Generic Manufacturer, to Comply with Both its State Law Duty to Update the Warning Labels and its Federal Duty not to Unilaterally Alter its Label. It is impossible for Westerly to simultaneously comply with federal and state law duties. The FDCA creates a framework that precludes generic manufacturers from complying with proposed state affirmative duties to independently modify their label. In addition, federally imposed duties create an inherent distinction 6

between brand name and generic manufacturers, making compliance with state law impossible. 1. Federal law creates a restricted framework such that generic manufacturers are impossibly limited from independently changing labels to comply with state imposed requirements. At issue is the labeling and warning duties for Westerly as a generic prescription drug manufacturer. The FDA allows generic manufacturers to submit an ANDA to market a generic equivalent of a previously FDA-approved brand name drug. To be approved for an ANDA, the generic manufacturer must prove that the drug is a bioequivalent of the brand name drug. 21 U.S.C.A. 355(j)(2)(A)(iv). Accordingly, the FDA requires generic manufacturers to use the same label as the brand name manufacturers. 21 U.S.C.A. 355(j)(2)(A)(v). This federal statutory restriction prevents generic manufacturers from taking unilateral action to comply with state-imposed duties to change their label. The FDA requires that the generic manufacturer cannot change its label without the FDA s prior approval. See Mensing, 564 U.S. at 624. In Mensing, respondents filed a failure to warn action alleging that long-term use of manufacturer s drug, metoclopramide, caused them a movement disorder called tardive dyskinesia. Id. The question was whether federal drug regulations preempted state imposed duties on manufacturers to strengthen their warning labels. Id. at 609. This Court held that federal law preempted state law from imposing an independent duty on the generic manufacturer to strengthen their label. Id. at 618. 7

This Court reasoned that the FDA allowed generic drug manufacturers to change their labels only after the brand name manufacturer s label change was approved. Mensing, 564 U.S. at 614. State law creates a duty for generic manufacturers to change the label as soon as they know or should have known a label defect has occurred. Id. at 611. Conversely, federal law significantly limits generic manufacturer s ability to independently change a warning label. Id. at 612. Therefore, a generic manufacturer is precluded from strengthening warning labels without express prior approval from the FDA. Id. at 614. Any state law duty requiring generic manufacturers to act unilaterally is prohibited by federal law. Mutual Pharmaceutical v. Barlett, 133 S.Ct 2466, 2479 (2013). In Barlett, New Hampshire law required all manufacturers to ensure that the products they design, produce, and sell were not unreasonably dangerous. Id. at 2480. Manufacturers there had a continual obligation to ensure product safety, which could be satisfied by altering a drug s chemical design or strengthening its label. Id. at 2475. Conversely, the express provisions in the FDA regulations precluded generic manufacturers from exercising either option. Id. at 2468. Therefore, the Supreme Court held that compliance with New Hampshire law was impossible, and any state claim based on a generic manufacturer s failure to strengthen warnings was preempted by federal law. Barlett, 133 S.Ct at 2477. Finally, courts have recognized a duty of sameness, which requires that generic manufacturers mirror their respective brand name drug s label wording. Morris v. PLIVA, 713 F.3d 774, 777 (2013). Since generic manufacturers are 8

precluded by federal law from unilateral action, they are necessarily dependent on their respective brand name s actions regarding chemical composition or labeling changes. Barlett, 133 S.Ct. at 2468. Any state law that mandates independent generic action violates this duty of sameness. Morris, 713 F.3d at 777. Here, Petitioner s claim against Westerly is necessarily preempted because Illinoza s burdensome law imposes a superfluous duty on Westerly that runs against the FDA s established framework. The federal law prohibits Westerly from acting unilaterally to strengthen the label, while Illinoza state law requires Westerly to strengthen its label. However, under Mensing and Barlett, Westerly s sole duty under the FDCA is to mirror GlaxoCline s labeling for ropidope. GlaxoCline, not Westerly, has the affirmative duty to flag and strengthen any warning labels. Barlett, 133 S.Ct. at 2468. It is impossible for Westerly to simultaneously comply with their FDA-imposed requirement to mirror GlaxoCline s label, and the Illinoza imposed duty to unilaterally update their label. Therefore, under the Supremacy Clause, federal law controls and Petitioner s claim under state law liability is preempted. 2. Brand name and generic manufacturers have distinct duties in regards to the accuracy and adequacy of their labels, deeming generic manufacturers at the mercy of brand name label changes. This Court has historically distinguished between brand name and generic manufacturer responsibilities. Mensing, 131 S.Ct. at 2587. State law based failure to warn claims may proceed against a brand name manufacturer because they can take unilateral action without violating federal law. Wyeth v. Levine, 555 U.S. 555 9

(2009). However, state law based failure to warn claims may not proceed against generic manufacturers because their sole duty is to keep their label consistent with the brand name s label. Wyeth, 555 U.S. at 573. This Court highlighted this dichotomy in Wyeth. Id. There, a doctor administered a direct injection of a nausea medication to a patient that later developed gangrene and lost an arm as a result. Id. at 555. The patient brought suit against Wyeth, the brand name manufacturer, on a failure-to-warn claim. Id. The Court there held that state law failure to warn claims against the brand name manufacturer were not preempted by federal law. Id. at 572. This Court reasoned that since the brand name bears responsibility for the content of its label at all times, it was not impossible for Wyeth, a brand name manufacturer, to comply with its state duty to provide an adequate warning describing the risk of the drug. Id. at 571. Here, unlike in Wyeth, Westerly does not have a responsibility over the content of its label at all times. In Wyeth, the Court reasoned that the federal law does not preempt the state imposed duty to warn placed on the brand name manufacture because the federal regulations permit it to provide warnings before receiving FDA approval. See Wyeth, 564 U.S. at 571. However, Westerly is a generic manufacturer whose sole duty is to mirror GlaxoCline s label. Accordingly, Westerly merely has a duty to communicate to the FDA about a possibility of a safer label, not a duty to change its label. State law mandating an additional duty to strengthen a label violates the duty Westerly has in keeping the label the same as GlaxoCline s. It is impossible for Westerly to simultaneously comply with Illinoza s 10

imposed duty to change its label and its federal duty to maintain the same label as the brand name manufacturer. Since federal law preempts state law when they are in conflict, Illinoza state law imposing an additional duty to change the label is preempted by federal law. B. Recognition of State Law Is Rightfully Preempted by Federal Law Because Recognition Creates an Untenable Obstacle to Congress Objective of Improving Healthcare Costs and Patient Welfare. Conflict preemption applies when state law stands as an obstacle to the accomplishment and execution of Congress full purposes and objectives. Freightliner Corp. v. Myrick, 514 U.S. 280, 287 (1995). As applied to generic manufacturers, imposing state liability would frustrate Congress and the FDA s objectives of increased generic drug entry, lower drug costs, and patient welfare. See David A. Kessler & David C. Vladeck, A Critical Examination of the FDA's Efforts to Preempt Failure-to-Warn Claims, 96 GEO. L.J. 461 (2008); Colleen Kelly, The Balance Between Innovation and Competition: The Hatch-Waxman Act, the 2003 Amendments, and Beyond, 66 FOOD & DRUG L.J. 417 (2011); Aaron S. Kesselheim & Jonathan J. Darrow, Hatch-Waxman Turns 30: Do We Need A Re- Designed Approach for the Modern Era?, 15 YALE J. HEALTH POL'Y, L. & ETHICS 293 (2015); Allison K. Young & Meredyth Smith Andrus, Pharmaceutical pricing and Hatch-Waxman reform: The Right Prescription, 1 J. OF GENERIC MED. 288 (2004). To ameliorate the growing problem of brand name price gouging while balancing the need for increased generic entry and patient safety, Congress passed The Drug Price Competition and Patent Term Restoration Act (Public Law 98-417), known as the Hatch-Waxman Act in 1984. Kesselheim, Hatch-Waxman, supra, at 11

301. Prior to the Hatch-Waxman Act, few incentives existed to entice drug manufacturers to invest in generic drug development. Kessler, Critical Examination, supra, at 461. Since generic drugs are secondary entrants into the drug market, they cannot command the same high prices as original brand name drugs. Kesselheim, Hatch-Waxman, supra, at 298. In addition to expected prices, generic drugs developed before Hatch-Waxman were required to undergo costly clinical trial efficacy and safety testing. Id. The Hatch-Waxman Act s new regulatory pathway encouraged generic drug competition, lowered drug prices and consumer costs for drugs, and thereby improved patient outcomes overall. Kelly, Balance Between, supra, at 417. Increased generic availability improves patient health outcomes. Kesselheim, Hatch-Waxman, supra, at 316. Part of this improved health outcome stems from increased patient adherence to prescribed drug regimes. Id. Nonadherence has widespread fiscal and public health consequences, costing the United States an estimated $100 billion per year, and 125,000 lives lost annually due to complications related to patients not taking their medications as directed. Jane E. Brody, The Cost of Not Taking Your Medicine, N.Y. TIMES, April 17, 2017, at D7. Cost is a significant factor in patient adherence, with one out of three elderly patients reporting not fulfilling a prescription or taking a reduced dosage because of high out-of-pocket cost concerns. Thomas S. Rector & Patricia J. Venus, Do Drug Benefits Help Medicare Beneficiaries Afford Prescribed Drugs?, 23 HEALTH AFF. 213, 219 (2004). As increased generic availability drives down drug costs, cheaper 12

therapy means that patients are more likely to comply with their doctors prescribed treatment, resulting in higher patient adherence rates and fewer costly complications to the healthcare system overall. Kesselheim, Hatch-Waxman, supra, at 317. Generic entry, facilitated by the Hatch-Waxman regulatory pathway, has directly contributed to improved patient welfare, and overall health, social, and economic effects on a patient and system-wide scale. See generally Kesselheim, Hatch-Waxman, supra. To avail themselves of the regulatory pathway through using an Abbreviated New Drug Application ( ANDA ), generic manufacturers exchange unilateral control over their own labels or exact drug composition for an easier and expedited regulatory pathway. See 21 U.S.C.A. 355(j). In exchange for a shorter approval process, generic drugs must have (1) the same active ingredients, (2) bioequivalence, and (3) identical labeling to the FDA-approved brand name drug. Barlett, 133 S. Ct. at 2471. Through the Hatch-Waxman Act, brand name manufacturers are responsible for the accuracy and adequacy of the warning labels, and generic manufacturers are only responsible for ensuring that the generic manufacturer s label is the same as the brand manufacturer s label. Id. Furthermore, unlike a brand name manufacturer, a generic manufacturer is additionally limited on alternative actions it may take, as the FDA considers them equivalent actions to label changes. Mensing, 564 U.S. at 615. A generic manufacturer cannot send out Dear Doctor letters with strengthened warnings because if a generic manufacturer did, and a brand name did not, it could inaccurately imply a therapeutic difference 13

between the two, and therefore mislead the public. Id. This is the duty that state law looks to impose on generic manufacturers, which would impermissibly distort the purpose of federal drug regulations. Mensing, 564 U.S. at 615. Conflict preemption led the Court in Medtronic v. Lohr to find state tort claims preempted. 518 U.S. at 470 (1996). In Medtronic, the Medical Devices Act ( MDA ) was an extension of FDCA that classified types of medical devices based on the potential risk they posed to the public. Id. at 474. Notably, the act allowed devices that were substantially equivalent to pre-existing devices on the market to avoid the long FDA testing approval process. Id. at 478. This was done to prevent a monopolization of the medical device market, and allow other producers to innovate on existing devices for overall patient benefit. Id. at 479. In the case, Lohr sued Medtronic under state tort law, which the Court found preempted because they feared recognizing the state action would frustrate the purpose of the act and discourage device manufacturer entry into the marketplace. Id. at 503. Here, the same tension exists between the Hatch-Waxman Act s purpose and state law failure to warn claims. Just as the MDA allowed substantially equivalent devices to encourage competition, innovation, and drive down prices for consumers, the Hatch-Waxman Act s encouragement of equivalent generic entry is geared at improving patient outcomes while decreasing costs. Kelly, Balance Between, supra, at 420. The increased costs associated with holding generic manufactures to state law duties would eclipse any benefit that the generic manufacturer would receive through the Hatch-Waxman Act, thereby discouraging generic entry and frustrating 14

the Hatch-Waxman Act s original purpose. The FDA also maintains that recognizing state law failure-to-warn cases threaten its ability to protect the public health. Kessler, Critical Examination, supra, at 463. Allowing state rulings that are directly in conflict with federal law could force generic manufactures to implement warnings that would explicitly contradict the FDA s restrictions. Id. at 464. Accompanied with the potential loss of the positive externalities associated with increased generic entry, this Court must find that conflict preemption bars Petitioner s claims. Therefore, state laws that attempt to impose similar labeling requirements on generic manufacturers as brand name manufacturers through failure to warn claims, frustrate the purpose of the Hatch-Waxman Act and threaten to eclipse any incentive provided by the regulatory pathway. This idea of conflict preemption has been upheld in similar regulatory systems. See Medtronic v. Lohr, 518 U.S. 470 (1996). II. THE COURT OF APPEALS FOR THE TWELFTH CIRCUIT CORRECTLY DISTILLED CONGRESSIONAL INTENT TO INCLUDE ATTORNEY S FEES AS AWARDABLE COSTS UNDER RULE 41(d). Vindication for the wrongly accused lies within the Federal Rules of Civil Procedure. The F.R.C.P. maintains that, 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 may order the plaintiff to pay all or part of the costs of that previous action. Fed. R. Civ. P. 41(d). A party need not show bad faith on behalf of the opposing party before an order of costs can be awarded. Esquivel v. 15

Arau, 913 F. Supp. 1382, 1388 (C.D. Cal. 1996). Moreover, the purpose of Rule 41(d) is to prevent vexatious litigation and prevent forum shopping, particularly by plaintiffs who attempt to gain advantages by dismissing and refiling suits. See Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 874 (6th Cir. 2000). Although Rule 41(d) is silent as to what explicitly is included in costs, given strong indications of congressional intent from other federal statutes and acts and the crucial purpose of Rule 41(d), this Court must affirm the Court of Appeals decision to include attorney s fees as awardable costs to Westerly. A. Congressional Intent to Include Attorney s Fees in Costs Is Apparent in Rule 68 and the Civil Rights Attorney s Fees Awards Act of 1976. Congressional consistency must be assumed by the Court. If other statutes and regulations include attorney s fees in the definition of costs, it logically follows that attorney s fees are included in Rule 41(d). For instance, if an offer by one party has been made and rejected by another, Rule 68 states that if the judgment that the offeree finally obtains is not more favorable than the unaccepted offer, the offeree must pay the costs incurred after the offer was made. Fed. R. Civ. P. 68(d). This Court held that cost-shifting attorney s fees to the non-prevailing party was acceptable. See Marek v. Chesney, 473 U.S. 1 (1985). In Marek, this Court found that absent contrary congressional expressions, where the underlying statute defines costs, attorney s fees are to be included as costs for purposes of Rule 68. 473 U.S. 1, 4 (1985). There, petitioners offered respondent a settlement of $100,000 that expressly included accrued costs and attorney s fees. Id. at 1. Petitioners were police officers who shot and killed 16

respondent s adult son while responding to a domestic disturbance call. Id. Respondent declined the settlement offer and the case went to trial where he was awarded a total of $60,000 for multiple claims and punitive damages. Marek, 473 U.S. at 1. Respondent then filed a request for additional attorney s fees under 42 U.S.C.A. 1988, the Civil Rights Attorney s Fees Awards Act of 1976. Id. The Act avers: [i]n any action or proceeding... the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney s fee as part of the costs. 1988(b). This Court reasoned that because Congress expressly included attorney s fees as costs available to a plaintiff in the Civil Rights Awards Act, such fees were subject to the cost-shifting provision of Rule 68. Marek, 473 U.S. 1, 4. Here, Westerly has requested attorney s fees as part of the costs accrued during litigation. The District Court of Illinoza granted Westerly s motion to dismiss the Complaint in its entirety. (R. at 3.) Nevertheless, Petitioner filed an appeal contesting the decisions to dismiss and to award any costs. Although Westerly has not requested attorney s fees in accordance to Rule 68, a canon of consistent usage asserts that congressional intent was to include attorney s fees when referring to awardable litigation costs. This includes costs awarded under Rule 41(d). B. The Purpose of Rule 41(d) Is to Discourage Vexatious Litigation, which Calls for the Rejection of the American Rule Disallowing the Award of Attorney s Fees. There exists a deep rooted principle known as the American Rule wherein each litigant pays their own attorney s fees, regardless of judicial outcome, unless a 17

statute or contract provides otherwise. See Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 252-253 (2010). This principle deviates from the English Rule, wherein a prevailing party can generally recover its attorney fees from the losing party. See RLS Assocs., LLC v. United Bank of Kuwait PLC, 464 F. Supp. 2d 206, 210 (2006). Most of the 18th century was regulated by fee recovery statutes. John Leubsdorf, Toward a History of the American Rule on Attorney Fee Recovery, 47 L. & CONTEMP. PROB. 9 (1984). Although this was not unusual as colonies regulated many parts of the economy, the concept did not survive the Revolution. Id. Lawyers freed themselves from the restrictions of fee regulation, for when a court ordered fees to be recovered from an opponent, the amount was statutorily limited. Id. at 12. Lawyers found determining their own fees was far more profitable. Id. The American Rule isn t necessarily a rule, but a theory evolved from lawyers attempting to optimize the fees they could collect. Id. Many circuits have deviated from the American Rule and awarded attorney s fees to the prevailing party. See e.g. Eager v. Kain, 158 F. Supp. 222, 223 (E.D. Tenn. 1957) (holding courts may require payment of costs, including attorney's fees of previous action, prior to allowing filing of second action); Evans v. Safeway Stores, Inc., 623 F.2d 121, 122 (8th Cir. 1980) (attorney s fees are within a district court s discretion); Behrle v. Olshansky, 139 F.R.D. 370 (W.D. Ark. 1991) (awarded fees); Esposito v. Piatrowski, 223 F.3d 497 (7th Cir. 2000) (upheld district court s discretion to award fees). 18

Generally, there are two categories of exceptions to the American Rule. Brice v. State, Dept. of Correction, 704 A.2d 1176, 1178 (1998). The first is a form of legislatively enacted fee-shifting statute. Id. The second is more arbitrary and involves a balance of equitable principles that have been recognized by the judiciary as a matter of common law. Id. Rule 41(d) is a legislatively enacted fee-shifting statute and an exception to the American Rule. Ultimately, Rule 41(d) s purpose is to prevent vexatious suits and to secure the payments of costs, particularly to parties that may have been disadvantaged by ongoing litigation. Phoenix Canada Oil Co. v. Texaco, Inc. 78 F.R.D. 445, 448 (D. Del. 1978). The American Rule encourages repeated litigation and judicial inefficiency. The American Rule was not enacted by Congress, and frustrates the purposes and protections of congressional intentions in Rule 41(d). Rule 41(d) is a legislatively enacted exception to the American Rule. Rule 41(d) is not the only exception applicable here. The second category exception involves a balance of equitable principles that have been judicially recognized as common law. Brice, 704 A.2d at 1178. For example, in Hardt, this Court held that a party need not prevail to be eligible for an award of attorney s fees but must achieve some success on the merits. 560 U.S. 242, 256 (2016). There, medical challenges forced petitioner to stop working and she subsequently filed for long-term disability benefits under her employer s plan. Id. at 245, 246. After not being able to receive the benefits she felt she was entitled to, Hardt sued Reliance, her employer s disability insurance carrier. Id. at 247. Given the petitioner s 19

obvious medical condition, the district court remanded to Reliance allowing 30 days to act on Hardt s application or else a judgment would be entered in her favor. Hardt. 560 U.S. at 248. Reliance awarded Hardt benefits, who subsequently filed a motion to obtain attorney fees from Reliance since she had attained the requisite of being the prevailing party. Id. at 249, 253. This Court relied on their previous decision in Ruckelshaus v. Sierra Club, stating in order for it to be appropriate to award attorney s fees, a party must have some success on the merits. 463 U.S. 680, 682 (1983). In Hardt, the District Court determined petitioner s medical condition was obvious enough to decide in her favor. 560 U.S. 242, 256. Therefore, success on the merits had been satisfied and attorney fees were awarded. Id. Another common law exception to the American Rule is the power of a court to award attorney s fees when the non-prevailing party has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. Brice v. State, Dept. of Correction, 704 A.2d 1176, 1179 (1998) (citing Alyeska Pipeline Serv. Co. v. Wilderness Soc y, 421 U.S. 240, 258-59 (1975)). In Brice, a Department of Corrections employee had been wrongfully denied a promotion. 704 A.2d at 1177. This Court awarded him the position with back pay and included attorney s costs because the employer acted within bad faith. Id. at 1179. Moreover, the purpose of the bad faith exception is not necessarily to punish the non-prevailing party but to make the prevailing party whole. Id. at 1178. Here, Westerly has shown likely success on the merits and has not acted in bad faith. As to the merits, the District Court dismissed Petitioner s Complaint in 20

its entirety and the Court of Appeals for the Twelfth Circuit affirmed the dismissal. (R. at 1, 11.) Following the precedent in Hardt and Ruckelshaus, this Court must deem the dismissal of the Complaint has established this notion of success on the merits. Westerly has not acted with bad faith because it was precluded from changing the label. Great measures are taken to ensure the protection of an accused party in the American Justice System. To require a party to retain an attorney to defend oneself against multiple lawsuits is an undue burden that infringes on due process standards. If a party is unable to afford adequate counsel, the opposing party could continually file suits until they succeed. Ironically, the American Rule is contradictory to the idea of protecting an accused party. It is imperative that this Court deviate from the American Rule and allow the award of attorney s fees under costs in this circumstance. Rule 41(d) does not define what is included in costs. However, this Court has derived congressional intent from other federal Statutes and acts that attorney s fees are included in the term cost. Moreover, the fundamental purpose of Rule 41(d) is to protect parties from undue litigation. Considering these factors, this Court must affirm the Court of Appeals for the Twelfth Circuit decision to include attorney s fees as awardable costs to Westerly. CONCLUSION Under the Supremacy Clause, federal law preempts state law. The impossibility of unilateral generic action and the importance of preserving 21

congressional intent compels this Court to apply the preemption doctrine to dismiss Petitioner s claims. Consistent usage and the inherent objection of precluding vexatious litigation compels this Court to include attorney s fees as awardable costs under Rule 41(d). For the forgoing reasons, Respondent respectfully requests that this Court affirm the Court of Appeals for the Twelfth Circuit s holding that 1) Petitioner s claims are correctly preempted by federal law, and 2) that attorney s fees are awardable costs under F.R.C.P. 41(d). Respectfully Submitted, Team 2069 Attorneys for Respondent 22

U.S. CONST. art. VI cl. 2 APPENDIX A Supremacy Clause United States Constitution This Constitution, and the laws of the United States which shall be made in pursuance thereof; and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding. A1

APPENDIX B Rule 41(d) Federal Rule of Civil Procedure (d) Costs of a Previously Dismissed Action. 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: (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. B1