Defeating a nationwide class action seeking hundreds of millions of dollars in damages, Kirkland & Ellis litigators Andrew Kassof and Barry Fields led a team in securing a major win for St. Jude Medical LLC and Abbott Laboratories.
Their victory—the case was dismissed with prejudice—was one of those legal sleights of hand that shows why venue can make all the difference.
The fight was over St Jude’s cardiac defibrillators, which provide pacing for slow heart rhythms and electrical shock or pacing to stop dangerously fast heart rhythms. The Food and Drug Administration recalled certain models in October of 2016 based on reports that the device’s lithium batteries could deplete suddenly and prematurely.
Abbott Laboratories acquired St. Jude as a wholly-owned subsidiary on January 4, 2017. Nine months later, the companies were hit with a nationwide class action in the Northern District of Illinois.
The suit was filed by ASEA/AFSCME Local 52 Health Benefits Trust, a “third party payor” of medical expenses—which on behalf of its beneficiaries was stuck covering the cost of implanting the recalled devices and may also be required to pay for removing and replacing the devices. They alleged that St. Jude actively concealed information about the defect from its management boards, the FDA and the public.
The Kirkland team’s first crucial step was to get the Illinois case dismissed on jurisdictional and venue grounds—even though Abbott is headquartered in Chicago.
The plaintiffs were forced to refile in Minnesota, where St. Jude is based—and where the U.S. Court of Appeals for the Eighth Circuit has more favorable precedent on preemption.
In a decision issued on January 24, U.S. District Judge David Doty sounded distinctly sympathetic to the plaintiff’s claims. “St. Jude put a defective product on the market that plaintiff paid for and must pay to replace,” he wrote. “In other words, plaintiff has been directly harmed by St. Jude’s alleged misconduct.”
But the Kirkland team argued that all of the claims were preempted under the Medical Device Amendments to the Federal Food, Drug and Cosmetic Act, because the plaintiff challenged the safety and effectiveness of pre-market approved devices.
It was enough to carry the day.
Citing binding Eighth Circuit precedent, Doty found that the court was “constrained to conclude that plaintiff’s claims are preempted. As a result, the court must dismiss the case.”