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From Products Liability Law Daily, December 27, 2017

$150M punitive damages verdict against AbbVie in AndroGel® bellwether trial tossed

By Susan Engstrom

In the first bellwether case involving the prescription testosterone-replacement medication AndroGel®, a federal court in Illinois vacated the jury’s $150 million punitive damages verdict against the drug’s manufacturers and ordered a new trial on a fraudulent misrepresentation claim brought by a heart-attack patient. According to the court, there was an irreconcilable conflict between the jury’s finding of liability on the part of the manufacturers and its award of zero compensatory damages to the patient (In re: Testosterone Replacement Therapy Products Liability Litigation (Mitchell v. AbbVie), December 22, 2017, Kennelly, M.).

The patient at issue in this case had filed a suit against AbbVie Inc. and Abbott Laboratories (collectively, AbbVie), the makers of AndroGel, alleging that the drug caused him to suffer a heart attack and that he would not have taken it but for AbbVie’s misleading marketing and failure to provide an adequate warning label. According to his complaint, although testosterone-replacement therapy (TRT) drugs such as AndroGel are considered safe and effective for the treatment of "classical hypogonadism" (low testosterone levels resulting from certain medical conditions), AbbVie falsely represented in its marketing and promotional materials that TRT drugs are safe and effective for the treatment of age-related hypogonadism (low testosterone levels due to the normal male aging process). The patient also alleged that AbbVie failed to adequately warn that using TRT drugs could increase the risk of heart attacks and strokes. He asserted claims for strict liability, negligence, and fraudulent misrepresentation. The matter was tried before a jury.

Verdict. The jury returned a verdict in favor of AbbVie on the strict liability and negligence claims but found in favor of the patient on the fraudulent misrepresentation claim [see Products Liability Law Daily’s July 25, 2017 analysis]. The jury awarded the patient zero dollars in compensatory damages but $150 million in punitive damages. Both parties filed post-trial motions contesting the jury’s verdict on the fraudulent misrepresentation claim. Neither party challenged the jury’s findings on the other two claims.

Inconsistency of verdict. The court determined that the jury’s verdict was internally inconsistent. By finding for the patient on the fraudulent misrepresentation claim, the jury necessarily found that he had proven each element of that claim by clear and convincing evidence, including that he "was damaged as a direct result of his and/or his physician’s reliance on [AbbVie’s false] representation" (per the jury instructions). However, by awarding zero compensatory damages, the jury also found that the patient had not "been damaged." (The jury instruction on compensatory damages stated that, "[i]f you find in favor of [the patient], then you must decide whether [he] has been damaged and, if so, the amount of his damages arising from his heart attack.") In the court’s view, it was illogical to assert simultaneously that someone has been damaged and has not been damaged.

The court rejected the parties’ attempts to reconcile the verdict. For example, the patient argued that the award of zero compensatory damages was the result of an oversight, but the court could not treat the jury’s finding with respect to the fraudulent misrepresentation claim as the "true" or "authentic" answer with which the compensatory damages award must be reconciled. One could just as easily say that the award of zero damages required a liability finding in AbbVie’s favor.

AbbVie argued that the jury might have inferred from the compensatory damages instruction that it could find for the patient on liability without finding that he suffered any damages. However, the jury instructions as a whole provided that the jury need not consider the issue of compensatory damages unless it found in favor of the patient, and that one of the elements of fraudulent misrepresentation was a finding that the patient "was damaged." The instructions also emphasized that each of the patient’s claims, including the fraudulent misrepresentation claim, required him to prove that AbbVie’s conduct was a cause of his heart attack. Thus, AbbVie’s theory was directly inconsistent with at least two express provisions of the jury instructions.

AbbVie also contended that the limitation on the type of compensatory damages that could be awarded provided a way to reconcile the jury’s verdict: the jury must have found that the patient was damaged in some way as a result of his or his physician’s reliance on AbbVie’s misrepresentations but must not have found that the manufacturer caused any injury arising from his heart attack. However, AbbVie did not provide an example of the type of non-compensable damage the jury might have found the patient to have suffered as a result of the alleged misrepresentation. The company did not—and could not—contend that a heart attack requiring medical attention is not an economically compensable injury, and the patient did not allege any harm apart from his heart attack. Furthermore, AbbVie’s theory was directly at odds with the jury instruction on causation, which stated that the jury could not enter a liability verdict for the patient on the fraud claim without finding that AbbVie’s conduct caused his heart attack, as opposed to some other unspecified injury.

According to the court, the irreconcilable conflict between the jury’s finding of liability on the fraudulent misrepresentation claim and the award of zero compensatory damages required a new trial on that claim. Moreover, because the jury’s punitive damages award depended on the viability of the jury’s liability finding, the court vacated that award as well. Thus, a new trial was ordered on the fraudulent misrepresentation claim and on damages related to that claim.

Evidence against AbbVie. The court also found that there was sufficient evidence to permit a reasonable jury to find that the patient had proven each element of his fraudulent misrepresentation claim by clear and convincing evidence. The patient was not required to identify an express statement about AndroGel that was false; rather, a reasonable jury could credit the opinion of the patient’s expert that by touting the ability of TRT drugs to treat age-related hypogonadism, AbbVie falsely represented that AndroGel was safe and effective for that use. A reasonable jury also could conclude from the evidence that the reliance by the patient’s physician on AbbVie’s representations caused him to prescribe, and caused the patient to use, AndroGel, and that the patient’s use of the medication caused him to suffer a heart attack.

Finally, the same evidence that would allow a jury to find in the patient’s favor on the fraudulent misrepresentation claim also would provide a basis for the jury to determine that AbbVie knowingly misrepresented the safety of AndroGel and, therefore, engaged in conduct that was fraudulent or showed a conscious disregard for the safety of others, ultimately resulting in the patient’s heart attack. Thus, the court also denied AbbVie’s motion to set aside the punitive damages award for insufficient proof at trial.

The case is No. 14 C 1748 (MDL No. 2545).

Attorneys: Benedict P. Morelli (Morelli Alters Ratner LLP) for Kenneth Aurecchia. Nancy A. Mismash (Robert J. Derby & Associates) for Ladale Mitchell. Janet H. Kwuon (Reed Smith LLP) for Eli Lilly and Co. David M. Bernick (Paul, Weiss, Rifkind, Wharton & Garrison LLP) for Abbott Laboratories, Inc. and AbbVie, Inc.

Companies: Eli Lilly and Co.; Abbott Laboratories, Inc.; AbbVie, Inc.

MainStory: TopStory DamagesNews JuryVerdictsNewsStory EvidentiaryNews DrugsNews IllinoisNews

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